Accenture, a remarkable IT company in India has sent information to their employees via email stating that they will not be giving any salary hikes to Indian and Sri Lankan employees in 2023, but this announcement is exceptional in few divisions of the country. According to reports provided by MoneyControl, the new notification issued by the company is not applicable in a few cases where there is a legal commitment or employees from critical skill areas.
Ajay Vij, the managing director communicated this decision to the employees. He explained about the macro headwinds faced by the IT company and the growth of the company was less than what was anticipated in the time period. He said that the employees payroll will be kept according to the market trends.
Ajay Vij, in his email explained that, the company’s compensation strategy focuses on providing a competitive salary based on skills and location of the employee, while the remaining categories will be more economical for the company. As a result, the organization will not grant increased base pay except for people with specific critical skill areas or if it is legally required. He also conveyed that the bonuses for the individual’s performance will be based on the contribution, but it will be “comparatively lesser than the previous year”. The promotions in the company is also reducing. As per the schedule, the promotions for Level 5- Associate Director will take place in December, but at a lower rate when compared to last year, and the promotions for other Levels from 1-4 has been postponed to June 2024 to coordinate with the objectives of the company.
This declaration from Accenture spotlights the ongoing challenges in the IT industry, affected by the factors like economic conditions and the managing costs to maintain the competition in the market. The outcome of these decisions on the broader job market and the spirit of sector employees is yet to be resolved.
The Financial year followed by the company is from September to August. During the financial year ended August 2023, the company’s revenue increased by 4% and was valued at $16 billion. The operating income had decreased by 16% and was at $1.91 billion. Operating margin was down by 12% and was at 270 basis. The company’s net profit was down by 18%, and was at $1.37 billion. New bookings of the entity fell to $16.6 billion from $18.4 billion, from both consulting and managed services. Overall, the consulting revenue decreased by 2% and the managed services revenue fell by 10%.
As per the official website of Accenture, the headcount of people is around 7,33,000. In March 2023, the company had announced that they would lay off almost 19,000 employees. At present, around 300,000 professionals are working in the company.
