'Panic, Anxiety' Among India's IT Professionals After Accenture Layoff News

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India’s IT professionals are writing about their worry on a community app after IT services firm Accenture said on Thursday it will lay off 19,000 employees globally.

Accenture said that as part of its second quarter of fiscal 2023 results, cost optimization efforts will impact 2.5 per cent or 19,000 of its 738,000 employee base. The company has more than 300,000 employees in India, one of its largest offshore centres.

"Panic and anxiety at peak," wrote an Accenture employee on Grapevine, a community app used by IT professionals in India.

Another employee said: "I'm checking my teMs access every 5minutes."

The news has made engineering talent in India anxious as earlier big tech companies Meta (Facebook), Amazon, Alphabet (Google’s parent) and Microsoft laid off employees.

IBM said last month it will lay off 3,900 people globally. But analysts have said Accenture’s action reflects the work of Indian IT services companies as they all follow a similar business model.

Accenture said that its hiring for Q3 will probably be minimal. It reported that utilization for the quarter ended February 28, 2023 was at 91 per cent, perhaps the highest when compared to other tier-one IT players.

Accenture’s management said that for a record quarter (Q2), the company managed to deliver with the existing talent base. “We have skills and all the people we need to deliver to demand in this market. Looking forward, we did not add people from Q1 to Q2. We see that being the same for Q2 and Q3. We may add headcount in Q4,” said Julie Sweet, chief executive officer of Accenture, during an earnings call.

The Indian engineering community’s worry is that other tier-one companies may also look at similar action. “It is generally like that. Most of these firms will follow what Accenture does. My fear is that we may have to see layoffs at Indian IT players too,” said an IT employee on condition of anonymity.

The trend resonates with what is happening in the sector. For instance, TCS had a negative headcount growth in Q3FY23. The hiring numbers of Infosys and Wipro too were softer than expected and several players are yet to hit campus to hire freshers.