Originally posted by Tim Holloway:
One thing I'd like to know. Up until recently, I'd been hearing that Indian IT salaries for non-management employees were topping out at about $10-12KUSD. Lately I've been hearing more like $17K or even 20 (8 or 9 lakhs). While I do know there's been some upward pressure lately, I've also been hearing that there's concurrently a pretty severe downward squeeze from the MNCs and from cartel action by the Indian firms.
So are these higher salaries a recent emergence, or was I just misinformed about times past?. Or is anything over Rs. 6 lahks still a rare exception?
Originally posted by Tim Holloway:
Lately I've been hearing more like $17K or even 20 (8 or 9 lakhs). While I do know there's been some upward pressure lately, I've also been hearing that there's concurrently a pretty severe downward squeeze from the MNCs and from cartel action by the Indian firms. So are these higher salaries a recent emergence, or was I just misinformed about times past?. Or is anything over Rs. 6 lahks still a rare exception?
Job Slipping Away
Little by little, Sab Maglione could feel his job slipping away. He worked for a large insurance firm in northern New Jersey, developing the software it uses to keep track of its agents. But in mid-2001, his employer introduced him to Tata Consultancy Services, India's largest software company. About 120 Tata employees were brought in to help on a platform-conversion project.
Maglione, 44, trained and managed a five-person Tata team. When one of them was named manager, he started to worry. By the end of last year, 70% of the project had been shifted to India and nearly all 20 U.S. workers, including Maglione, were laid off.
Since then, Maglione has been able to find only temporary work in his field, taking a pay cut of nearly 30% from his former salary of $77,000. For a family and mortgage, he says, "that doesn't pay the bills." Worried about utility costs, he runs after his two children, 11 and 7, to turn off the lights. And he has considered a new career as a house painter. "It doesn't require that much skill, and I don't have to go to school for it," Maglione says. And houses, at least, can't be painted from overseas.
Harder to Find
Jobs that stay put are becoming a lot harder to find these days. U.S. companies are expected to send 3.3 million jobs overseas in the next 12 years, primarily to India, according to a study by Forrester Research.
If you've ever called Dell about a sick PC or American Express about an error on your bill, you have already bumped the tip of this "offshore outsourcing" iceberg. The friendly voice that answered your questions was probably a customer-service rep in Bangalore or New Delhi. Those relatively low-skilled jobs were the first to go, starting in 1997.
But more and more of the jobs that are moving abroad today are highly skilled and highly paid � the type that U.S. workers assumed would always remain at home. Instead Maglione is one of thousands of Americans adjusting to the unsettling new reality of work. "If I can get another three years in this industry, I'll be fortunate," he says.
Businesses are embracing offshore outsourcing in their drive to stay competitive, and almost any company, whether in manufacturing or services, can find some part of its work that can be done off site. By taking advantage of lower wages overseas, U.S. managers believe they can cut their overall costs 25% to 40% while building a more secure, more focused work force in the U.S. Labor leaders � and nonunion workers, who make up most of those being displaced � aren't buying that rationale.
"How can America be competitive in the long run sending over the very best jobs?" asks Marcus Courtney, president of the Seattle-based Washington Alliance of Technology Workers. "I don't see how that helps the middle class."
On the other side of the world, though, educated Indian workers are quickly adjusting to their new status as the world's most sought-after employees. They have never been more confident and optimistic � as Americans usually like to think of themselves. For now, at least, in ways both tangible and emotional, educated Americans and Indians are trading places.
Uma Satheesh, 32, an employee of Wipro, one of India's leading outsourcing companies, is among her country's new elite. She manages 38 people who work for Hewlett-Packard's enterprise-servers group doing maintenance, fixing defects and enhancing the networking software developed by HP for its clients. Her unit includes more than 300 people who work for HP, about 90 of whom were added last November when HP went through a round of cost-cutting.
"We've been associated with HP for a long time, so it was an emotional thing," Satheesh says. "It was kind of a mixed feeling. But that is happening at all the companies, and it's going to continue." Satheesh says that five years ago, computer-science graduates had one career option in India: routine, mind-numbing computer programming.
Anything more rewarding required emigrating. "Until three years ago, the first preference was to go overseas," she says. Nowadays her colleagues are interested only in business trips to the U.S. "People are pretty comfortable with the jobs here and the pay here"--not to mention the cars and houses that once seemed out of reach. Employees in her group earn from $5,200 a year to $36,000 for the most experienced managers.
And as American companies have grown more familiar with their Indian outsourcing partners, they have steadily increased the complexity of work they are willing to hand over. Rajeshwari Rangarajan, 28, leads a team of seven Wipro workers enhancing the intranet site on which Lehman Brothers employees manage personal benefits like their 401(k) accounts. "I see myself growing with every project that I do here," Rangarajan says. "I really don't have any doubts about the growth of my career."
More Jobs Going
Her experience with a leading brokerage will probably help. Financial-services companies in the U.S. are expected to move more than 500,000 jobs overseas in the next five years, according to a survey by management consultant A.T. Kearney, and India is by far the top destination. U.S. banks, insurance firms and mortgage companies have been using outsourcing to handle tech support for years.
Now these firms are using Indian workers to handle the business operations � say, assessing loan applications and credit checks � that the technology supports.
Kumar Mahadeva, CEO of the thriving outsourcing firm Cognizant, explains the appeal: "It becomes logical for them to say, 'Hey, you know everything about the way we do claims processing. Why not take a piece of it?'"
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Indian companies are going on a hiring spree at the moment and are looking for even more people with the right skills.
So what are the hottest jobs going?
Software skillsets as well as domain expertise are undoubtedly the pick of the season. And here's what companies in the Big League in India's IT sector is looking for.
Says Laxman Badiga, chief executive, operations and staffing at Wipro Technologies:
"People needs are picking up across all areas. There's a big difference in availability of skills compared to the last couple of years, which also shows that the market is active. The need is for across the board skills like developers, leaders, quality analysts and project managers.
�We are recruiting at the implementation as well as the consultant and architect levels. For consultants, skills could either be domain or technology. Telecom software, package implementation like SAP and embedded system skills are hot.''
Big Hiring Boom
TCS targets to be among the top ten IT companies globally by 2010. "To achieve that, we need to reach headcount of 60,000-70,000. That would mean adding up to 5000 per year,'' says Mr Atul Takle, VP, corporate communications of TCS:"85% of our hiring is from the category 1 & 11 engineering colleges in the country.
�We also hired 148 MBAs last year," he adds. Says a spokesperson for Satyam: "The demand is for professionals with skills in packaged software like SAP, Oracle and PeopleSoft.�
HR consultants and experts also agree that 2003 could well go down in history as the turnaround year for Indian IT hiring. Says a senior official at Mercer Consulting: "While 2001 was a bad year, things have started looking up in 2003. IT industry is currently on a hiring spree especially for skillsets like ERP implemantation. Companies are also focusing on consulting skills as they seek to move up the value chain. Hiring is also targeted at specialised skillsets,'' he adds.