Cognizant steps up hiring to offset attrition pain | Economic Times

Chennai: Cognizant is looking to offer jobs about 100,000 experienced professionals in 2021 and train close to 100,000 associates, in order to offset the impact of elevated attrition rate.The US-based company, which has more than two-thirds of its employees in India, reported an attrition rate of 31%—the highest among IT peers—in the April-June period. In the previous quarter, Cognizant quarterly annualised attrition rate stood at at 21%. The company has more than 301,200 employees."We now expect to hire approximately 100,000 laterals in 2021 and to train close to 100,000 associates. In addition, we expect to onboard approximately 30,000 new graduates in 2021 and make 45,000 job offers to new graduates in India for 2022 onboarding," CEO Brian Humphries said, while lauding the company's human resources team for helping mitigate the impact of attrition through comprehensive hiring, onboarding and skilling programmes.Cognizant—while announcing its second quarter results on Thursday—raised its revenue growth forecast to double digits for the current fiscal due to strong demand for its services, while highlighting that attrition was a key concern. Revenue is now likely to grow by 10.2-11.2% (9.0-10.0% in constant currency) over the year-ago period to $18.4-$18.5 billion in 2021. Cognizant's quarterly annualised attrition rate stood at 21%. The company has more than 301,200 employees.For the quarter ended June, TCS's attrition rate stood at 8.6%, Infosys' at 13.9%, Wipro at 15.5% and HCL Tech's at 11.8%. Accenture had reported 17% attrition in the March to May quarter.Attrition has been one of the company's biggest concerns with Humphries in May saying that the software major has had to let go of new business due to the company's inability to hire talent. This is significant as the software industry is seeing a massive demand for outsourcing, especially through the pandemic. Cognizant's revenue grew 14.6% year-on-year (12.0% in constant currency terms) to $4.6 billion in the April-June period—its best quarterly revenue so far. Digital revenue, which grew about 20% during the quarter, now represents 44% of the company's total revenue.“We delivered a strong second quarter,” Humphries said in a statement on Thursday. “Through targeted investments, we’ve been shifting our portfolio to faster-growing market segments while extending our capabilities and partnerships to help clients build modern businesses," he said. "I see a stronger, more competitive Cognizant emerging, with growing commercial momentum. We are bullish on the industry and our prospects within it.”The company has deployed $1.5 billion on acquisitions, share repurchases and dividends year-to-date.“Second quarter topline results exceeded our guidance, driven by improved demand for our services and momentum in our digital revenue, and we increased our full-year 2021 revenue growth to 10.2-11.2%,” said Jan Siegmund, chief financial officer of Cognizant. “To meet the strong client demand for our services, we have continued to scale our recruiting capabilities and invest in our people."Revenues in financial services, which constitutes 32.8% of the company's revenues, grew 7.6% year-on-year or 4.8% in constant currency terms. This included the benefit of recently completed acquisitions and growth in digital revenue, the company said in a statement.Revenue declines related to non-digital services continued to pressure results as clients optimised the cost of supporting their legacy systems and operations.The company also made a special mention in its statement about how annual growth across all segments reflects the impact on 2020 revenues from the pandemic and the April 2020 ransomware attack.