Idle staff in US, Europe to drag profits of Indian software companies like TCS, Infosys and Wipro - The Economic Times: "BANGALORE: The rising number of idle workers in the US and Europe for Indian software companies could drag profitability lower. This will add to troubles already caused by an uncertain business environment, where clients are delaying decisions around technology projects.
The so-called 'bench' consisting of engineers who are not working on any active projects has increased by at least seven percentage points at TCS, InfosysBSE -0.02 % and Wipro, analysts said. Industry executives and analysts are of the view that the swelling bench could shave off up to 150 basis points from operating margins in the coming quarters.
Onsite utilisation rates, or the proportion of engineers in client locations assigned to billable projects, have fallen to below 90 per cent from 97 per cent at the beginning of the year. A senior industry executive, who works closely with large IT companies, said that up to 18 per cent of onsite staff are sitting idle at some firms."
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The so-called 'bench' consisting of engineers who are not working on any active projects has increased by at least seven percentage points at TCS, InfosysBSE -0.02 % and Wipro, analysts said. Industry executives and analysts are of the view that the swelling bench could shave off up to 150 basis points from operating margins in the coming quarters.
Onsite utilisation rates, or the proportion of engineers in client locations assigned to billable projects, have fallen to below 90 per cent from 97 per cent at the beginning of the year. A senior industry executive, who works closely with large IT companies, said that up to 18 per cent of onsite staff are sitting idle at some firms."
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