Cognizant’s number of employees at the end of the second quarter dropped to levels last seen at the end of 2018 as the company embarked on a massive cost cutting programme leading to a firing of about 7,000 employees.
The company had 281,200 people on its rolls as of June 30, down from 291,700 sequentially, and 2.5 percent from 288,200 in the second quarter of last fiscal. Quarterly annualized attrition moved up to 24 percent, one of its highest in the industry, while voluntary attrition was 11 percent. This means that the remaining 13 percent were made redundant.
Every major IT company saw headcount declines in the last quarter because of the lockdowns and slowdown, but none as high as Cognizant. TCS's was down 4,788.
Net headcount declined approximately 2.5% year-over-year, including the roughly 7,000 associates exited under the Fit for Growth plan. These cost actions as well as increased rigor in our performance management process are reflected in our elevated annualized attrition rate of 24 percent. Voluntary attrition continued the downward trend we've seen over the last four quarters to approximately 11 percent. in Q2,” said outgoing chief financial officer Karen McLoughlin in a conference call with analysts.
As reported in People Matters earlier, Cognizant also deferred joining of campus recruits to September quarter. Given the subdued demand environment, Cognizant also freezed most of its lateral hiring across all functions in India, with few exceptions in sales roles.
Additionally in May, the company saw a number of senior level exits including Jaideep Poondir, SVP in the banking and financial services vertical, Rajesh Balaji, SVP and global delivery head of enterprise application services practice, and Vinayambika Kidiyur, SVP and global delivery transformation head.