Part Time Employees No Longer Needed IT Companies Now Focusing on Retaining Permanent Staff

Job offers from IT companies: Contracting by IT companies has fallen by almost 20%, with tech companies now focusing on retaining their permanent employees. The main reason for the slump is the macroeconomic conditions unfolding and the shift in focus from IT service companies to retaining permanent employees. With demand from the IT sector falling, recruitment companies are also scrambling to onboard more clients.Read Also – ‘Businesses Need to Clarify Policies on Employment and Undeclared Work,’ Experts Say, as Work From Home in IT Sector Draws to a Close

“When it comes to hiring tech talent, demand for contract staff has fallen by 10-20% from IT companies since March this year. The main reasons for the slump are the macroeconomic conditions at play and the shift in focus from IT service providers to permanent employee retention,” quoted AR Ramesh, Director of Digital Business Solutions, Professional Staffing and International Engagement, Adecco, a staffing firm and temporary work agencies as I said. Also read – Executives from Apple, Google, Netflix and Amazon India are set to abscond before the parliamentary body on Tuesday


  • Adecco estimates that around 10-12% of IT and IT-enabled services (ITeS) contract workers have less than eight years of technology experience.
  • The drop in contract staffing comes as a deepening crisis in the IT sector has seen companies on a hiring frenzy after two years of a Covid-induced doldrums.
  • From the second half of 2021 to a quarter ago, companies offered 60-70% raises and counter offers as companies across all sectors needed tech teams to digitize their systems and run cloud computing operations, the report said at
  • However, tech companies are cutting their hiring targets for the next fiscal year as they have been saddled with a large workforce, people who were hired but not deployed.

“Tech companies are now realizing they must balance the long-term with the short-term to attract and retain talent. Some recent short-term tactics have required a correction which, if not fully reduced, may have impacted contract staffing demand,” said Rituparna Chakraborty, co-founder and chief executive officer of TeamLease Services. Also read – The global IT and business services market is expected to grow at 5.6% in 2022. Full report here

Recruitment firms that rely heavily on contract staff will hurt their revenue if the trend continues.

“About 40% of our revenue depends on hiring IT contract staff, and demand is down 30% this quarter (July-September) compared to the previous three months,” said Saran Balasundaram, Founder of Tech-Recruiting company HanDigital. Balasundaram said if the trend continues, their revenue from contract IT staff will be down 12-15% by the end of this fiscal year.

Staffing agencies said they were “knocking on doors” to grow their client base and avoid a slump in sales.

The recruitment firm saw a 10-20% drop in hiring mandates from July through September compared to the same period last year.