India faces outsourcing labor shortage

passingby · Jun 10th, 2005, 04:25

BANGALORE, India (AP) -- India is beginning to see a shortage of properly skilled labor in its back-office outsourcing industry, and could fall short by a quarter million workers in four years, officials have said.

read here

This is a very good explanation of my point of view from the other thread that got closed.

snowcrab · Jun 10th, 2005, 08:49

It's nice to have more customers than product. Means you can make plans for the future with a little confidence.

Things can change. When I was a youngster "made in Japan" was a term of derision. With their manufacturing sector decimated by war the Japanese didn't have much in the way of resources to create much more than trinkets, catchy little wood and paper beach umbrellas to perch on the side of your glass. But they did persever, reinvest in infrastructure and education and now "Japanese made" is no longer synonymous with crap.

One of the things India is selling a knowledge based product. It needs more infrastucture, more schools and something better than those wooden keyboards Kerala fishermen are practicing on now. But the fact that people will practice on wooden keyboards so they are ready for the real thing when there are enough to go around tells a lot about spirit. As long as Indian companies are willing to keep reinvesting in India that attitude is going to make the difference, just as it did in Japan.

Though I hope and pray India never gets as expensive to live in as Japan.

phantom · Jun 10th, 2005, 11:33

Well, I have read some of these articles from other sources. But this shortage is being predicted from the last 5 yrs. or so. It still hasnt happened. You should never underestimate this number "1 Billion".
Right now most of the BPO industry is situated only in the "A" cities. There are millions of those educated young people in "B" and "C" cities, which will make sure that prices will remain low and the supply will always overflow the demand.
Like every other economy, when it hits the peak, indian economy too will come down. But I dont see that happening in the next 50 yrs. India has still a long way to reach the top and till it reaches that point, the only direction is UP !!

Nick-H · Jun 10th, 2005, 15:41

Predictions like this are like weather forcasts... they can be toatally wrong, the forcasters can still point to the reasons for what they said.

Thing is, these kind of people get paid to theorise and talk, and talk they do.

steven_ber · Jun 10th, 2005, 16:10

Quote:

Originally Posted by Nick-H

Predictions like this are like weather forcasts... they can be toatally wrong, the forcasters can still point to the reasons for what they said.

Thing is, these kind of people get paid to theorise and talk, and talk they do.

I predict that this thread will turn cloudy, there may be thunder & lightning and the next few days are likely to be stormy, before it has a chance to blow over, the thread might be closed.

Though I always hope I'm wrong with the weather.

phantom · Jun 10th, 2005, 17:19

A very good oppurtunity to prove the master JEDI (Steven) wrong

C'mon Luke, Lets keep DARTH out of it !!!!

beach · Jun 10th, 2005, 17:22

The manpower shortage is a fact even today. All the headhunters in fact overheated with poaching the ‘right’ candidates for the companies. It’s a paradox. At one end there is severe shortage of manpower, at the other end people don’t get job easily.

The buzzword is experience. The new cos popping up every now and then wants experienced hands. For they don’t want to spend (waste) their money on training people to do their works. This has started a nasty game of pulling experienced people out of rival companies.

Many companies collapsed simply because of the exodus of their key staffs to a new arrival company.

At the other end is the ‘raw’ graduates. It’s an egg or chicken story. Without job you don’t get experience. Without experience you don’t get job. Somehow people get break somewhere and they take it from there.

Then there is this call center jobs. The dirtiest job on earth. Employee turnaround is as high as 200%, means every position in the company is vacated twice a year!

There are the higher end jobs, which employs technically qualified people in a maddeningly wide area anything from radiology to aerospace.

India produces about 5000PhDs an year. For 20000rs or so a company can hire an experienced PhD for their work, much less than what it cost to hire a car driver in say New York. That dictates the market. After all job too is a market commodity which is liable for all the standard rules of supply vs demand.

In India if it’s not cheap (or competitive, if I use the more parliamentary word), people would go elsewhere where it’s cheap. Let it be cheaper cities in India or other similar countries.

passingby · Jun 10th, 2005, 18:51

are you guys missing the point of the article...????

the reason India is facing a shortage in outsourcing is that they don't have enough people who are qualified to do the jobs. Even if they have hundreds of thousands graduates every year, only 9 in a 100 are qualified to the western standards to get the job.
That is why India is experiencing a shortage in jobs.

THAT was the point of the article. and that was my point in the other thread, that Indians are working according to the western standard and they are still in training.

beach · Jun 10th, 2005, 18:55

Two recent article by Thomas L Friedman. The comparison in the first one is funny and apt, at least for India

Bangalore: Hot and Hotter
By THOMAS L. FRIEDMAN
Published: June 8, 2005

Bangalore, India Every time I visit India, Indians always ask me to compare India with China. Lately, I have responded like this: If India and China were both highways, the Chinese highway would be a six-lane, perfectly paved road, but with a huge speed bump off in the distance labeled "Political reform: how in the world do we get from Communism to a more open society?" When 1.3 billion people going 80 miles an hour hit a speed bump, one of two things happens: Either the car flies into the air and slams down, and all the parts hold together and it keeps on moving - or the car flies into the air, slams down and all the wheels fall off. Which it will be with China, I don't know. India, by contrast, is like a highway full of potholes, with no sidewalks and half the streetlamps broken. But off in the distance, the road seems to smooth out, and if it does, this country will be a dynamo. The question is: Is that smoother road in the distance a mirage or the real thing?
(Full article at NY times)

35-hour week? 35-hour day!
By Thomas L. Friedman
The New York Times
SATURDAY, JUNE 4, 2005

BANGALORE, India It was extremely revealing traveling from Europe to India as French voters - and now Dutch ones - were rejecting the EU constitution - in one giant snub to President Jacques Chirac, European integration, immigration, Turkish membership in the EU and all the forces of globalization eating away at Europe's welfare states. It is interesting because French voters are trying to preserve a 35-hour workweek in a world where Indian engineers are ready to work a 35-hour day. Good luck.

Voters in "old Europe" - France, Germany, the Netherlands and Italy - seem to be saying to their leaders: Stop the world, we want to get off; while voters in India have been telling their leaders: Stop the world and build us a stepstool, we want to get on. I feel sorry for Western European blue-collar workers. A world of benefits they have known for 50 years is coming apart, and their governments don't seem to have a strategy for coping.
.
.
.
.
.
.
.
.

To appreciate just how explosive, come to Bangalore, India, the outsourcing capital of the world. The dirty little secret is that India is taking work from Europe or America not simply because of low wages. It is also because Indians are ready to work harder and can do anything from answering your phone to designing your next airplane or car. They are not racing us to the bottom. They are racing us to the top.

Indeed, there is a huge famine breaking out all over India today, an incredible hunger. But it is not for food. It is a hunger for opportunity that has been pent up like volcanic lava under four decades of socialism, and it's now just bursting out with India's young generation.

"India is the oldest civilization, the largest democracy and the youngest population - almost 70 percent is below age 35 and almost 50 percent is 25 and under," said Shekhar Gupta, editor of The Indian Express. Next to India, Western Europe looks like an assisted-living facility with Turkish nurses.

Sure, a huge portion of India still lives in wretched slums or villages, but more and more of the young cohort are grasping for something better. A grass-roots movement is now spreading, demanding that English be taught in state schools - where 85 percent of children go - beginning in first grade, not fourth grade. "What's new is where this movement is coming from," said the Indian commentator Krishna Prasad. "It's coming from the farmers and the Dalits, the lowest groups in society." Even the poor have been to the cities enough to know that English is now the key to a tech-sector job, and they want their kids to have those opportunities.

The Indian state of West Bengal has the oldest elected communist government left in the world today. Some global technology firms recently were looking at outsourcing there, but told the communists they could not do so because of the possibility of worker strikes that might disrupt the business processes of the companies they work for. No problem. The communist government declared information technology work an "essential service," making it illegal for those workers to strike. Have a nice day.
(Link to the article in International Herald Tribune)

Bigzero · Jun 10th, 2005, 18:59

so which road is this thread taking? what do i see in the distance? is that steven_ber with a lock and key?

kaushiks · Jun 10th, 2005, 19:15

Passingby, you are a genius with amazing depth. You will get your Nobel prize by post.

passingby · Jun 10th, 2005, 19:17

Quote:

Passingby, you are a genius with amazing depth. You will get your Nobel prize by post.

shall we start insulting each other? I am good at that too you know, but I respect my husband's website unlike other people... meaning you, in case you don't get it.

machadinha · Jun 10th, 2005, 19:26

Quote:

Originally Posted by passingby

are you guys missing the point of the article...????

the reason India is facing a shortage in outsourcing is that they don't have enough people who are qualified to do the jobs. Even if they have hundreds of thousands graduates every year, only 9 in a 100 are qualified to the western standards to get the job.
That is why India is experiencing a shortage in jobs.

THAT was the point of the article. and that was my point in the other thread, that Indians are working according to the western standard and they are still in training.

I don't know Passingby, we heard you the first time and the conversation got out of hand, I'm a little surprised you're so insistent on doing it all over again. The article is just a CNN/AP news snippet based on a couple of numbers and some folks' remarks, it's interesting alright but hardly an earth-shattering in-depth study or anything. Of course western management models are being exported, how wouldn't they, it's called global capitalism. The seemingly firm 9 to 100 ratio gets downplayed two paragraphs later, in a not very lengthy article in itself, where it appears these are one CEO's estimates. And so another news article is born and the journalist can rest assured of another day's wages.

All IMHO of course, I wish you no harm and I hope you and us all have a nice day.

machadinha · Jun 10th, 2005, 19:32

Quote:

Originally Posted by beach

Two recent article by Thomas L Friedman. The comparison in the first one is funny and apt, at least for India

Maybe, yes, the articles have been brought up several times already so they must strike a chord with some people. It is where he sees some link with the recent EU Constitutional vote that I completely lose him, I can't follow the argument and it doesn't seem to me to shed a particularly insightful light on what's going on in Europe. Maybe I've been seeing too many analyses of the question however, burnout does occur, but his piece doesn't seem to me to stand out amidst all that jive.

2cents · Jun 10th, 2005, 19:32

Quote:

This is a very good explanation of my point of view from the other thread that got closed.

Passingby, irrespective of the merits of the above article it wouldn't do anything to change the opinions of those who don't agree with you.The people who feel strongly about the whole outsourcing affair, have their own point of view which are based on personal experiences, good or bad.And each side can dig up articles,reports and studies to support their arguments and beliefs and all it would do is to tally up the brownie points, nothing more.At the most it would provide some material to peruse for those whose life and career are insulated from outsourcing wave and whose interests are purely academic; piqued by all the recent hullaboo about it in the media.
...and as the rumblings from Steven_ber shows, the moderators are waiting for the first sign of escalation to close this thread down too.

Jun 10th, 2005, 04:25	#1
passingby Account Closed Join Date: Aug 2004 Location: New Jersey Posts: 436	India faces outsourcing labor shortage BANGALORE, India (AP) -- India is beginning to see a shortage of properly skilled labor in its back-office outsourcing industry, and could fall short by a quarter million workers in four years, officials have said. read here This is a very good explanation of my point of view from the other thread that got closed.

Jun 10th, 2005, 15:41	#4
Nick-H Loud-mouthed, Noisy Bird Join Date: Oct 2004 Location: Chennai, India Posts: 25,832	Predictions like this are like weather forcasts... they can be toatally wrong, the forcasters can still point to the reasons for what they said. Thing is, these kind of people get paid to theorise and talk, and talk they do. __________________ . Just one member of the IndiaMike Mod Team

Jun 10th, 2005, 18:59	#10
Bigzero back to my old ways Join Date: Oct 2003 Location: Hyderabad Posts: 1,444	so which road is this thread taking? what do i see in the distance? is that steven_ber with a lock and key? __________________ miles to go.... Bigzero's Photo Gallery

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Jun 10th, 2005, 08:49	#2
snowcrab Maha Guru Member Join Date: Jan 2005 Location: Alberta, Can Posts: 1,028	It's nice to have more customers than product. Means you can make plans for the future with a little confidence. Things can change. When I was a youngster "made in Japan" was a term of derision. With their manufacturing sector decimated by war the Japanese didn't have much in the way of resources to create much more than trinkets, catchy little wood and paper beach umbrellas to perch on the side of your glass. But they did persever, reinvest in infrastructure and education and now "Japanese made" is no longer synonymous with crap. One of the things India is selling a knowledge based product. It needs more infrastucture, more schools and something better than those wooden keyboards Kerala fishermen are practicing on now. But the fact that people will practice on wooden keyboards so they are ready for the real thing when there are enough to go around tells a lot about spirit. As long as Indian companies are willing to keep reinvesting in India that attitude is going to make the difference, just as it did in Japan. Though I hope and pray India never gets as expensive to live in as Japan.

Jun 10th, 2005, 11:33	#3
phantom Maha Guru Member Join Date: Oct 2004 Location: Delhi Posts: 1,214	Well, I have read some of these articles from other sources. But this shortage is being predicted from the last 5 yrs. or so. It still hasnt happened. You should never underestimate this number "1 Billion". Right now most of the BPO industry is situated only in the "A" cities. There are millions of those educated young people in "B" and "C" cities, which will make sure that prices will remain low and the supply will always overflow the demand. Like every other economy, when it hits the peak, indian economy too will come down. But I dont see that happening in the next 50 yrs. India has still a long way to reach the top and till it reaches that point, the only direction is UP !!

Jun 10th, 2005, 17:19	#6
phantom Maha Guru Member Join Date: Oct 2004 Location: Delhi Posts: 1,214	A very good oppurtunity to prove the master JEDI (Steven) wrong C'mon Luke, Lets keep DARTH out of it !!!!

Jun 10th, 2005, 17:22	#7
beach Lost in translation Join Date: Dec 2003 Location: India ! Posts: 2,232	The manpower shortage is a fact even today. All the headhunters in fact overheated with poaching the ‘right’ candidates for the companies. It’s a paradox. At one end there is severe shortage of manpower, at the other end people don’t get job easily. The buzzword is experience. The new cos popping up every now and then wants experienced hands. For they don’t want to spend (waste) their money on training people to do their works. This has started a nasty game of pulling experienced people out of rival companies. Many companies collapsed simply because of the exodus of their key staffs to a new arrival company. At the other end is the ‘raw’ graduates. It’s an egg or chicken story. Without job you don’t get experience. Without experience you don’t get job. Somehow people get break somewhere and they take it from there. Then there is this call center jobs. The dirtiest job on earth. Employee turnaround is as high as 200%, means every position in the company is vacated twice a year! There are the higher end jobs, which employs technically qualified people in a maddeningly wide area anything from radiology to aerospace. India produces about 5000PhDs an year. For 20000rs or so a company can hire an experienced PhD for their work, much less than what it cost to hire a car driver in say New York. That dictates the market. After all job too is a market commodity which is liable for all the standard rules of supply vs demand. In India if it’s not cheap (or competitive, if I use the more parliamentary word), people would go elsewhere where it’s cheap. Let it be cheaper cities in India or other similar countries.

Jun 10th, 2005, 18:51	#8
passingby Account Closed Join Date: Aug 2004 Location: New Jersey Posts: 436	are you guys missing the point of the article...???? the reason India is facing a shortage in outsourcing is that they don't have enough people who are qualified to do the jobs. Even if they have hundreds of thousands graduates every year, only 9 in a 100 are qualified to the western standards to get the job. That is why India is experiencing a shortage in jobs. THAT was the point of the article. and that was my point in the other thread, that Indians are working according to the western standard and they are still in training.

Jun 10th, 2005, 18:55	#9
beach Lost in translation Join Date: Dec 2003 Location: India ! Posts: 2,232	Two recent article by Thomas L Friedman. The comparison in the first one is funny and apt, at least for India Bangalore: Hot and Hotter By THOMAS L. FRIEDMAN Published: June 8, 2005 Bangalore, India Every time I visit India, Indians always ask me to compare India with China. Lately, I have responded like this: If India and China were both highways, the Chinese highway would be a six-lane, perfectly paved road, but with a huge speed bump off in the distance labeled "Political reform: how in the world do we get from Communism to a more open society?" When 1.3 billion people going 80 miles an hour hit a speed bump, one of two things happens: Either the car flies into the air and slams down, and all the parts hold together and it keeps on moving - or the car flies into the air, slams down and all the wheels fall off. Which it will be with China, I don't know. India, by contrast, is like a highway full of potholes, with no sidewalks and half the streetlamps broken. But off in the distance, the road seems to smooth out, and if it does, this country will be a dynamo. The question is: Is that smoother road in the distance a mirage or the real thing? (Full article at NY times) 35-hour week? 35-hour day! By Thomas L. Friedman The New York Times SATURDAY, JUNE 4, 2005 BANGALORE, India It was extremely revealing traveling from Europe to India as French voters - and now Dutch ones - were rejecting the EU constitution - in one giant snub to President Jacques Chirac, European integration, immigration, Turkish membership in the EU and all the forces of globalization eating away at Europe's welfare states. It is interesting because French voters are trying to preserve a 35-hour workweek in a world where Indian engineers are ready to work a 35-hour day. Good luck. Voters in "old Europe" - France, Germany, the Netherlands and Italy - seem to be saying to their leaders: Stop the world, we want to get off; while voters in India have been telling their leaders: Stop the world and build us a stepstool, we want to get on. I feel sorry for Western European blue-collar workers. A world of benefits they have known for 50 years is coming apart, and their governments don't seem to have a strategy for coping. . . . . . . . . To appreciate just how explosive, come to Bangalore, India, the outsourcing capital of the world. The dirty little secret is that India is taking work from Europe or America not simply because of low wages. It is also because Indians are ready to work harder and can do anything from answering your phone to designing your next airplane or car. They are not racing us to the bottom. They are racing us to the top. Indeed, there is a huge famine breaking out all over India today, an incredible hunger. But it is not for food. It is a hunger for opportunity that has been pent up like volcanic lava under four decades of socialism, and it's now just bursting out with India's young generation. "India is the oldest civilization, the largest democracy and the youngest population - almost 70 percent is below age 35 and almost 50 percent is 25 and under," said Shekhar Gupta, editor of The Indian Express. Next to India, Western Europe looks like an assisted-living facility with Turkish nurses. Sure, a huge portion of India still lives in wretched slums or villages, but more and more of the young cohort are grasping for something better. A grass-roots movement is now spreading, demanding that English be taught in state schools - where 85 percent of children go - beginning in first grade, not fourth grade. "What's new is where this movement is coming from," said the Indian commentator Krishna Prasad. "It's coming from the farmers and the Dalits, the lowest groups in society." Even the poor have been to the cities enough to know that English is now the key to a tech-sector job, and they want their kids to have those opportunities. The Indian state of West Bengal has the oldest elected communist government left in the world today. Some global technology firms recently were looking at outsourcing there, but told the communists they could not do so because of the possibility of worker strikes that might disrupt the business processes of the companies they work for. No problem. The communist government declared information technology work an "essential service," making it illegal for those workers to strike. Have a nice day. (Link to the article in International Herald Tribune)

Jun 10th, 2005, 19:15	#11
kaushiks Senior Member Join Date: Dec 2004 Location: don't live anymore Posts: 446	Passingby, you are a genius with amazing depth. You will get your Nobel prize by post.

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