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Global IT firms on a hiring spree in India
November 08, 2006 16:11 IST
In order to hire people with required skills, more than 68 per cent of IT companies globally have started or planning to start business operations in India in the next three years, the global consultancy and research major said in a report.
The growing appetite for Indian talent pool comes on the back of rising concerns over severe skill shortages and fattening salaries that are looming over the local IT sector.
However, the major risk for the country comes in the form of skyrocketing salary levels itself, which might cost it the position as a key low-cost location.
The global talent hunt for IT workers could lead to severe skill shortages and further rise in salary levels, PwC found in a survey of 153 top executives at IT firms worldwide.
Growing competition for skills has led to a sharp jump in technology sector salaries in emerging markets. Compensation levels are increasing to the point where countries like China and India would no longer be viewed as more cost-effective locations to source talent, PwC added.
As many as 41 per cent of the survey respondents said they are finding it difficult to locate technical skills in emerging markets, while 48 per cent accepted having trouble retaining the talent they do find.
According to PwC, as many as 43.75 per cent respondents said they have now begun business operations in India to hire people with required skills, followed by United States and Canada at second position with 41.67 per cent.
Western Europe has emerged as the third favoured destination, with 40.28 per cent of the companies saying they have now started their operations in the two regions, followed by China and Eastern Europe with 37.5 per cent votes each.
However, India has slipped to the third position below China and Eastern Europe in the list of regions where companies plan to begin operations in the next three years.
As many as 25 per cent of the firms are planning to begin India operations in the next three years, as against 27.06 per cent for China and 26.39 per cent for Eastern Europe.
After combining the figures for those who have now begun their India operations and those planning in the next three years, India is the top destination with 68.75 per cent companies giving affirmative answers.
The country is followed by 64.58 per cent for China and 63.89 per cent for Eastern Europe. "Competition for talent has never been fiercer and there is likely to be another industry talent war if demand increases," Graham Wyllie, director, PwC said.
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