Indian information technology (IT) firms' net hiring of engineers is expected to drop almost 50 per cent, year-on-year, in the upcoming fiscal year, according to hiring firms interviewed by the Economic Times (ET).

This is said to be a result of IT firms exercising more caution.

Staffing firm TeamLease has forecast a 40 per cent decline in "FY24 (fiscal year 2024) headcount addition vis a vis FY23 addition, based on the current outlook from companies."

But things could be different in six months if companies change their growth forecasts, Sunil C, the chief executive officer of TeamLease Digital, told ET.

Coming out a pandemic, IT firms had reportedly gone big on hiring and attrition in FY22 and in the first half of FY23. But the rising inflation and deepening energy crisis in Europe has caused a decline in talent demand.

Technology spending is expected to be even more cautious after the recent fall of the Silicon Valley Bank and UBS' acquisition of Credit Suisse.

Only last week, Accenture had announced 19,000 job cuts to manage costs.

Accenture's headcount growth during the December-to-February quarter was only 424 people, way out from the average 13,000 global net headcount addition in the past three quarters.

The top-five Indian IT companies saw a decline of about 5,000 new employees added in the third quarter of current fiscal year.