BY UNA GALANI
Remote working has become a happy norm for many information industry workers. Companies from New York to San Francisco to London to Paris are struggling to coax employees back into the office, resorting to handing out ever-more generous incentives from free meals to free transportation.
Employers are on the back foot because the pandemic has led to a huge expansion in demand for tech services as companies accelerate their digital strategies. Revenue growth at industry stalwart Infosys more than doubled to 21% in the September quarter year-on-year from pre- pandemic levels, for example.
One likely solution to the workforce problem will be to shift more jobs offshore, reversing a recent trend where many companies in the United States and Europe focused on on- shoring or near-shoring their techies to please politicians or simply to be closer to the rich-world clients they serve.
Yet offshoring 2.0 will be a fraught affair as service providers are grappling with unprecedented levels of attrition in India, the original low-cost hub. Cognizant Technology Solutions lost a stunning 37% of its 300,000- plus India-dominated workforce on an annualised basis in the quarter ending in September. Others like Wipro are reporting 20% attrition.
As in the West, Indian workers are struggling to juggle their jobs as prolonged school closures take a toll. Junior staff who’ve worked from their towns and villages during the pandemic are quitting simply to avoid moving back into cramped, shared apartments in polluted cities. The talent squeeze is likely to persist even as the pandemic subsides because India’s own domestic tech industry is booming, and its 100-plus unicorns are competing for manpower, leaving techies spoiled for choice in jobs.
Some global IT services firms are already doubling down outside of India: Blackstone-controlled Mphasis is opening offices from Mexico to Costa Rica. Expect others to ramp up their overseas plans too. But an equal number of companies accustomed to WFH will bet that hiring in India will be less financially painful than keeping jobs elsewhere.
First published December 2021