New Jersey-headquartered Congizant has hired 41,000 employees in 2021, including 33,000 new college graduate hires from India even as the IT services major reported the highest voluntary attrition at 31 per cent in an industry witnessing a war of talent, as per the Q4 earnings report released by the company on Thursday.
Nearly two-thirds of Cognizant’s employee base is in India. The company said in an official statement that it has also invested in providing 23 million hours of training for its employees.
The IT major has an employee base of 3.3 lakh and its attrition woes have been existent for sometime now with top executives in the company leaving in succession.
The annualised voluntary attrition of Cognizant stood at 31 per cent for 2021, which is still lower than 33 per cent which was reported by the company in the September quarter. Top sources within the company said that the IT services firm has seen employee poaching, especially with the top executives leaving the firm.
“In some of the big projects, the employees have joined client firms with almost 50 per cent salary hikes offered. This has, in turn, posed retention problems ,” one of the sources said.
Top IT company management commentaries suggest that the attrition will still remain high for at least a few quarters from now, while stabilising in the second half of the FY23.
“During 2021, we continued to invest in our people and strategic initiatives while navigating the heightened cost pressures driven by the labor supply demand imbalance. With $2.7 billion of cash and short-term investments and free cash flow in excess of 100 per cent of net income, we are well-positioned to execute our balanced capital allocation framework, including the third -consecutive annual increase of the dividend announced today,” Jan Siegmund, Chief Financial Officer, said at the Q4, 2021 earnings call.
Brokerages have also been voicing concern of Cognizant’s talent crunch issues which is bringing supply side constraints on large projects and which could hit the deal momentum too. However, the company CEO has reposed confidence on his workforce saying that the company "has entered 2022 with momentum and confidence that [its] talented employees' position [the company] to capture the substantial market opportunity.
The company said that its revenue-outlook for 2022 is highest-ever at 8.5-11.5 per cent growth to $20 billion-$20.5 billion .
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