Indian technology companies are now looking to hire fresh engineering graduates from American universities, as stringent immigration norms and high unemployment in the US make local hiring attractive, said a media report.
“We have a target of hiring 250 local employees every quarter in the US for the next four quarters,” the Economics Times reported, quoting S Gopalakrishnan, CEO of Infosys.
India-based tech firms including Wipro, Tata Consultancy Services (TCS), Infosys and Cognizant are now battling it out to hire hundreds of fresh engineering graduates from campuses of Pennsylvania State University, Rutgers, University of Massachusetts, University of Connecticut , North Carolina State University and University of Michigan, among many others, the report said.
“As we develop our consulting and systems integration services, we need to hire more at all levels in the United States. Brand recall for companies like ours is improving every year, we are slowly getting there,” Gopalakrishnan added.
In August 2010, the US Congress passed a bill that effected a steep hike of $2,000 to about $4,300 in visa fees for skilled workers. However, this measure is likely to result in additional visa costs of over $200 million to Indian companies every year.
In September 2010, Ohio state in the US banned outsourcing of government IT and back office projects to offshore locations after president Barack Obama announced that tax benefits will be taken away from American companies that ship jobs overseas.
The Indian outsourcing industry fears that similar ban by other states will have a strong negative impact on its revenues.
Besides, the companies which outsource their work to Indian companies such as General Electric (GE) wants the Indian firms to play a role in addressing high unemployment rates in the US.
A recent poll from CBS News showed that nearly six in 10 Americans are at least somewhat concerned that they or someone else in their household would be out of work and looking for a job within the next 12 months.
“There is no big cost difference because we have to pay American salaries even to our Indian employees going there,” he added.
The report said talent availability in the US is much smaller compared with India, where there is a churn out of about 600,000 engineering graduates annually.
“Though IT is a popular choice, compared to Indian colleges, the pool of students looking out for a career in IT is smaller and all tech firms are tapping into this pool; so definitely, the war for talent is there,” said Priti Rajora, global head, talent acquisition, Wipro Technologies .
TCS, Infosys, Wipro and HCL have already begun setting up development centers in locations such as Atlanta and Michigan, the report notes.
Over the next five years, TCS aims to double its foreign workforce from 10,000 currently to 20,000, while Infosys and Wipro plans to see non-Indians constitute 10-15 percent of their total employee base in next 3-5 years, up from around 5 percent currently.
The top three companies also plan to hire about 100,000 people in 2011 in India, which is much higher than the 20,000 people they hired last year.
The Indian information technology (IT) industry earns 80 percent to 85 percent of its revenues from software services and back office operations from the US and European markets.