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article imageIndia High-tech Industry Out Of Skilled Workers

By Sheba     Apr 7, 2007 in World
Nearly two decades into India's phenomenal growth as an international center for high technology, the industry has a problem: It's running out of workers.
And the problem is not that it's people lack the proper education. Indian schools put out 400,000 new engineers every year yet only a scant 100,000 actually join the work force.
One problem is that students receive the academic knowledge but lack the practical experience. Many schools do not even have a computer lab and communication skills seem to be a problem across the board.
"The problem is not a shortage of people," said Mohandas Pai, human resources chief for Infosys Technologies, the software giant that built and runs the Mysore campus for its new employees. "It's a shortage of trained people."
For us in the West, India has become a huge outsourcing destination. How many of you have called your local long distance operator and ended up speaking to someone in Punjab? I for one have spoken to customer service reps from India to Argentina.
We think of these countries with their cheap labour market and wonder how we can compete. Now this country of 1.03 billion people is feeling the back lash. It does not have a bottomless source of skilled labourers.
"This is really the Achilles heel of the industry," said James Friedman, an analyst with Susquehanna Financial Group, an investment firm based in Bala Cynwyd, Pa., who has studied the issue.
Back in 2000, there were as many as 500,000 applicants per 50,000 jobs. Now they have seen a drop to between 100,000 to 200,000 qualified candidates per 180,000 jobs annually.
It seems the high-tech industry is growing so fast that the population cannot meet the demands for 'high end workers.' India's largest software company, Tata Consultancy Services hires about 3,000 new employees per month. Another consulting firm, Accenture is looking at hiring 8,000 over the next six months and IBM plans to bring in another 50,000 workers in India by 2010.
A shortage means something feared here: higher wages.
India is at a cross road in the world of tech support. It success rests on the fact that its software workers work for less pay than those in the West - about 1/4 the salary of someone in the West. If the industry fails to find skilled labourers it could see the industry stumble. Poland and the Philippines are competitors and can end up benefiting from India's failure.
The school system is very flawed and instead of getting better it seems to be getting worse. Technical schools have problems like electrical shortages. Colleges lack computers and some universities have professors that rarely show up and outdated text books.
The best schools do not fare much better either. Even the government run Indian Institutes of Technology have problems of its own. Although it is among the most competitive in the world with excellent facilities and top-level professors students seem to suffer as a result of the rigorous study just to pass the entrance exam to get into these schools of higher learning.
They learn by rote study. Only test scores matter. By the time they get there, "Everything else is forgotten: the capacity to think, to write, to be logical, to get along with people," Pai said. The result is smart, well-educated people who can have trouble with such professional basics as working on a team or good phone manners.
"The focus," he said, "is cram, cram, cram, cram."
So what is the industry doing to correct the situation? The larger companies have built their own training centers to train new workers. Take for example the Mysore campus which is in the technology hub of Bangalore which began building three years ago.
It has 120 faculty members, more than 80 buildings, 2,350 hostel rooms and a 500,000-square-foot education complex. There's a movie complex built inside a geodesic dome. An army of workers sweeps the already-spotless streets and trims the already-perfect lawns.
Month by month, it's getting bigger. Today, some 4,500 students at a time attend the 16-week course for new employees. By September, there will be space for 13,000.
Infosys spent $350 million on the campus, and will spend $140 million this year on training, said Pai, the human resources chief.
"This is the enormous cost we have to pay to ensure we have enough people," he said.
They're not the only ones.
IBM training programs went to well over 100,000 Indians last year from children to university professors. And Tata extended its recruitment arm from as far away as Uruguay, to having business exes teach university classes, all in an effort to make people employable.
At the Infosys campus things are different. Here they focus on the "soft-skills" classes where they teach things like e-mail etiquette and problem solving skills.
They also encourage recreation and proper work etiquette.
There's a soccer field, a cricket field, a swimming pool with a juice bar, a bowling alley and a gym. There are racks of bicycles to ride.
You could drown in politeness. "Ride Carefully" a sign warns bicyclists at a gentle curve in the road; "Enjoy your visit," a passing student tells a visitor.
Everywhere, there are well-groomed, well-mannered young people.
On a recent morning, students filed into a large classroom for a programming course.
By 8:45 a.m. — 15 minutes before class began — the room was nearly full. Row after row of students sat quietly, waiting for the teacher.
Now with training like that lets hope that the world's largest democracy gets it right in the tech industry for once. Hats off to them. This country has come a long way and has a long way to go yet. India is a survivor if anything. I am sure this is just one more hurdle it will overcome.
More about India, High-tech, Shortage, Skilled workers
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