Far from taking away US jobs, Indian IT companies are actually creating huge employment in the US. In fact, dismissing US president Barack Obama's argument that Indian IT companies are responsible for rising unemployment, these companies say it is the shortage of talent in the US that is forcing them import talent from India.
"The fact that we are not contributing to the US economy is totally baseless. The Indian IT companies have created about 2,50,000 jobs in the US in the last three years and most of them are high paid jobs," said Ameet Nivsarkar, vice-president (global trade), the National Association of Software and Services Companies (Nasscom).
According to Nivsarkar, the advantage is not just in terms of cost but also in terms of knowledge base and a large talent pool that is available in India. US has a scarcity of talent base.
According to commerce minister Anand Sharma, in August itself Indian IT companies created 7,000 jobs in the US but the recent protectionist measures taken by the US, such as hiking professional visa fees, could hamper such economic activities.
Infosys employs around 12,000 people in North America, including about 1,300 US citizens and permanent residents. The company announced that it is planning to hire 1,000 more US locals during this fiscal. TCS has hired about 1,350 people in the US recently and is planning to hire more.
However, Indian IT companies are citing talent crunch in the US as one of the reasons for importing workforce from India. "Those who say that we do not hire because of the cost factor, are wrong. At present the salary of Indian IT professional is at par with the US, especially post recession. But even we are willing we find it difficult to get high skill professionals," said a senior HR manager from Infosys.
The same concern was expressed by the Cognizant Technology Solutions. The company said that it has hired about 50 recruitment staff in the US looking for IT professionals there but without much success.
The company says it is forced to import Indians on work visas. "If you look at the core of what we do, the technology work, the US simply doesn't have the talent base today," said Francisco d'Souza, president and chief executive, Cognizant, said last week. Similarly, TCS, Genpact and Wipro said that they are planning to hire more locals from the US.
According to Ken Chan, vicepresident, Moody's Investors, "The added costs of higher visa fees, if passed on to US clients, are also not likely to shift either the secular growth in outsourcing or its geographic pattern away from India to elsewhere." Moreover, it says that government- funded work represents only a small, single- digit percentage of the business of Indian IT companies, so even if other US states took up Ohio's ban, business derived just from banking and financial service firms would still dwarf the lost revenues in magnitude.
Indian IT companies are not the sole beneficiary of outsourcing. According to McKinsey, every dollar of costs the US moves offshore, it brings US a net benefit of $ 1.12 to $ 1.14, apart from benefitting them in terms of higher productivity, new export markets and a talent pool.
The Indian software companies pay over $ 1 billion each year to the US government in the form of social security for their Indian IT professionals who go for short term contract in the US.
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