Cognizant Technology Solutions, a US-based IT services company, faced a considerable reduction in workforce in the final quarter of 2024. 10,700 dropped out, leaving it with around 336,800 by the end of December. Compared with the previous quarter, this has registered a net reduction of 3,300 workers, leading to growing worries that the industry is losing its workers in a number higher than ever before.
This would imply that its attrition rate, or the number of employees that have left during a certain period, stood at 15.9% on a trailing twelve-month basis. These statistics are rising just like others across the other Indian IT firms due to different factors like higher salaries, good job opportunities, and work environment flexibility.
Cognizant Trends And Future Plans
Despite the high attrition, the company is positive about the future. The company’s Chief Financial Officer, Jatin Dalal, said that Cognizant will continue hiring throughout 2025 to fuel its growth. He said, “As we look forward, we feel that we will add headcount as we need to grow and as we grow during 2025.
Return of employees is another positive indicator that Cognizant has seen in the form of the return of former employees. CEO Ravi Kumar S reports that 13,000 employees returned to work for the company in 2024, and 10,000 expressed interest in returning. The firm has “boomerang employees” because of its strong reputation and reading experience, and talent flows into the organization.
However, Cognizant is under pressure with its utilization rate, which is the measuring rod for how efficiently a company is utilizing its workforce. The utilization rate contracted by two percentage points to 82 percent, meaning fewer employees were doing billable projects. Still, the management said utilization will improve throughout 2024 and looks good going forward.
Financial Outlook
Even after it reduced the number of its employees, Cognizant performed well financially as its revenues increased over expectations for the quarters. For 2025, it expects revenue to grow 3.5% to 6% annually in constant currency. So far, it shows positive momentum for the next year, as attrition and utilization at its core seem to be struggling.
This is reflected in the company’s ability to attract returning employees and its future hiring plans, which reflect a focus on stabilizing the workforce while continuing to grow in the competitive IT services industry.
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