labels: services, marketing - general, hrd, investments, it features
Glimmer of hopenews
John P Matthew
19 August 2003

Mumbai: Forrester Research analyst John C McCarthy believes that the US will witness an explosion of information technology work going out of the country. This may seem a Cassandra-like prognosis to many Indians.

McCarthy prophesises that at least 3.3-million white-collar jobs and $136 billion in wages will shift from the US to low-cost countries by 2015. Which means 3.3-million white-collar American Stuarts will be out of jobs and the gainers will mostly be our desi Thomases, Dinkars and Haris.

And hear what Information Technology Association of America''s (ITAA''s) third annual IT workforce study has to say. The US IT workforce, it says, shrank by an aggregate of 528,496 workers in 2001, with companies hiring 2.1-million IT workers while laying off about 2.6 million.

So, the attrition rates have been quite high. Most of the 2.1 million hired maybe Indians, Chinese and Filipinos, while the 2.6 million who lost their jobs in a sort of quid pro quo maybe honest-to-goodness Americans. Therefore, the prognosis is that millions of cola-guzzling Americans will sit and watch the telly while the super-smart and deadly-clever Asian (read Indians) will walk away with their plum jobs.

IT hiring pattern (approximate figures)
Company
Period
Jobs
Total employees
Attrition rate (%)
New clients
Tata Consultancy
Apr-Jun
2003
600
19,000
7
84
Infosys Technologies
Apr-Jun
2003
2,175
17,095
6.9
22
Wipro Technologies
Apr-Jun
2003
895
14,618
8
38

Yawning gap
ITAA had estimated that the US will need 1.6-million IT workers in 2001. But the number of American college graduates with high-tech degrees is falling. According to the US department of education, the number of bachelor-level computer science degrees awarded by US universities declined more than 40 per cent between 1986 and 1994, from 42,195 to 24,553. So who fills the yawning gap in demand and supply? Obviously, Indians and other code-smart Asians.

Meta Group Research fellow Howard Rubin says the US''s piece of the estimated 5-million global IT jobs is decreasing. The US now has about half of the world-wide IT workforce (2.5 million), and that workforce is growing at a rate of about 10 per cent annually. Therefore, by 2015, there will be around 7.8-million IT jobs in the US. From this, as McCarthy has been quoted above, 3.3-million jobs will be going offshore. That will leave 4.5-million jobs in the US.

World-wide IT workforce expansion rates, in the meantime, have been growing by up to 20 per cent yearly, with countries like Canada, India, China and the Philippines experiencing a growth rate two to four times that of the US. With the number of computer graduates from US universities shrinking, naturally, a lot of jobs will migrate to the fertile shores of India, Canada and other Asian countries.

According to National Association of Software and Services Companies (Nasscom), the Indian IT industry has added 73,750 knowledge professionals in 2002-03. This is in spite of the SARS scare and the US policies detrimental to welcoming Indian professionals with open hands. However, the deprivation of their jobs is causing a lot of heartburn in the developed nations.

Obviously, 3.3-million plum white-collar jobs and $136 billion in wages are no trifling figure. Therefore, workplace harassment has been an issue every Indian IT professional should be prepared to face. In Malaysia recently, it went to the extent of arrest and detention.

Azim PremjiOn the lesson India should learn from the Malaysian fiasco, Wipro Technologies chairman Azim Premji tells domain-b: "IT companies should follow the visa rules and regulations very strictly, and they should take their customers into confidence in all their dealings."

Says Ravi Mehta, CEO, Athena Consulting and Outsourcing (www.icejobs.com), a company specialising in IT recruitment: "The US government''s visa policy will have a substantial impact on the hiring of Indian IT professionals."

Mehta is of the view that the Indian government should use IT more in state and central government departments. A sensible thought, as it will help create more jobs within the country without depending entirely on foreign contracts. "Before bidding for foreign contracts let us fine-tune our skills on our own systems, which are badly in need of automation."

Hiring patterns
When 3.3-million jobs are migrating out of the US by 2015 it is worthwhile studying the hiring patterns followed by Indian IT industry majors. In the quarter ended June 2003, Tata Consultancy Services (TCS) added around 600 professionals to its rolls, Infosys a huge 2,175, and Wipro Technologies 895. Though the companies claim to have controlled attrition rates around the 7-per cent mark, unofficially the rates are much higher. TCS has now about 19,000 employees, Infosys 17,095 and Wipro Technologies 14,618.

In a competitive atmosphere, IT companies are realising that they cannot be complacent about non-performers. Infosys has a policy of inculcating a strong performance ethics within itself. It has set minimum standards of performance and those who are identified as laggards are put in the performance improvement plan (PIP), though it has created a lot of disgruntlement within the Infosys team.

Wipro has a more direct approach; they reward the top performers while those languishing in the bottom 10 per cent are given pink slips. Therefore, attrition rates at IT companies should also differentiate between those who are leaving voluntarily for greener pastures and those who have been given the heave-ho.

Of late, there has been a marked decline in the choice of IT as a career among youngsters. Well, they have been reading the wrong articles. They should be reading what McCarthy has to say instead. It seems, the choices before Indian IT workers are quite vivid. There is a demand in advanced countries and a shortage in the supply of qualified professionals. Though noises are being made about the flow of jobs to Asia, eventually market dynamics will level the playing field and jobs will flow to the Indian shores.

And, yes, where are those Oracle, C and Java ''For Dummies'' textbooks?

 


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Glimmer of hope