Recruiting India

Posted by Jim Stroud

February 8, 2006

I stumbled across this article - Google begins recruiting in India. It said that Google was “looking to recruit software engineers with bachelor’s degrees and doctorates, as well as system administrators, for its newly established research and development center in Bangalore.”

So how is Google going about its sourcing efforts? To quote… “Google placed advertisements in local Indian newspapers with links to its Web site, which detailed qualifications and other information.” (Perhaps in an attempt to keep up with the Joneses?)

Hmmm… not very imaginative, but is an ad in the paper all it takes to recruit in India? I was curious for two reasons. For one, so many people target India for technical talent that the competition has to be fierce, especially as the pool of talent dwindles. Secondly… (is secondly a word?) I imagine India as the pre-game show before the Superbowl of Recruiting occurs in the very near-future here in the USA.

So towards that end, I dug up some intelligence on the recruiting landscape in India. Take a peek.

Finding talent in India can be incredibly difficult. While there are a number of under- and un- employed high school and college graduates in India, generally these individuals are not trained with the skills needed by multinational employers.

In addition, some Indian candidates with strong skills may not fit the needs of multinational employers because of the historical variations in work practices from those found in the West. In other words, while at some levels and in some industries there are many candidates with the technical skills to fill a position, they may not have the cultural skills to Ã¢â‚¬Å“fit inÃ¢â‚¬? with an organization.

Finally, there is a shortage of talent at the upper end of the employment scale, particularly in IT. There simply arenÃ¢â‚¬â„¢t enough candidates with the necessary experience to fill top roles. Turnover levels have gone up in many industries, including IT and IT enabled sectors and to a lesser extent in advertising, marketing, and retailing. Though still below the rate of comparable industry segments in the West, turnover can be a problem, as economic growth, increased salaries, and a shortage of skilled employees at the top of the scale can tempt the best and the brightest to change jobs often.

As a result of this shortage, and to combat turnover rates, salaries have risen dramatically in high demand sectors, especially at the upper ends of the scale. In addition, salaries in India account for less than half the value of a typical compensation package. Benefits like rent-free or concessional housing, free use of motor vehicles and/or drivers, interest subsidies on loans, and the like may all be part of a total compensation package. (Want more? Read: Recruiting in India: An Overview)

Sounds a lot like the first dot-com bubble, yes? Well, the plot thickens…

As of July 2005, IndiaÃ¢â‚¬â„¢s population stands around 1.08 billion with a labor force of just over 480 million. However, unemployment remains high at around 9.2 percent. Some of the leading industries in India include telecommunications, IT and software.

But wait, that’s not all!

Call it pre-emptive hiring, hoarding talent or just a recruitment drive on sixth gear, but tech companies are recruiting engineers even though they may not have work or immediate need for them.

A phenomenon which was prevalent during the boom years of technology in the late 1990s has revisited India. And, with the fight for talent intensifying in the country, recruiters say this is just the beginning.

“We hire dozens of IIT engineers every year not because we need them for current projects, but because we find them good and promising for the future. Most often they are not put on a project for the next six to nine months,” says Arjun Malhotra, chairman and chief executive officer of Headstrong, an IT services company.

(Want more? Read: No work, but still IT companies are hiring)

So with all of this said, I would like to pose a question (actually, several questions) to any and all concerned. Just what does it take to recruit and retain talent in India? At what point does pre-emptive hiring become too much? At what point does it cease to be only about the compensation for candidates? At what point do companies begin to fall due to the lack of good engineers to power them?

The comments section is open, I would love to hear what you have to say.