The great Indian jobs boom seems to be back again. An Indian software giant, which used to hire 50 to 60 people a month during the first quarter of this year, says it is now averaging more than double the number. That's close to the hiring pattern in the peak of the dotcom boom four years ago, a top executive says.
While the comparison with the dotcom boom days may be a little premature at this stage, the huge upswing in the jobs market is clear. For instance, in the quarter ended September 30 this year, the top-five Indian software companies added close to 18,000 employees, according to National Association of Software and Service Companies.
That's close to the 20,000 people the five hired in 2002-2003. "We're not in the heydays of the dotcom boom days as yet, but the market has definitely turned for the better," says an industry expert.
The recruitment pattern has also been different from the dotcom era. For instance, during the dotcom days, most of the hiring by the Indian firms was for "bodyshopping", as these companies later sub-contracted their software engineers to foreign firms. This time, the increase in jobs is for programming work within India.
During the quarter, Infosys Technologies' workforce grew from 27,939 to 32,949 -- an 18 per cent increase in just three months. At the end of last year's third quarter, Infosys had 18,580 employees. The headcount at Tata Consultancy Services climbed nearly 12 per cent in the same quarter -- from 36,636 to 40,948. In June 2003, TCS employed about 24,000 people.
According to some estimates, India's technology companies are expected to hire 75,000 to 1,00,000 people by the end of this year -- a 50 per cent increase compared with last year -- because after years of relatively-sluggish growth, the sector is roaring again and is expected to grow by 30 to 40 per cent this year.
The surge has no doubt been aided by companies like Accenture, Hewlitt Packard, IBM, Cap Gemini, Ernst and Young, and Electronic Data Systems, which have ramped-up hiring in India mainly to take advantage of cheap labour.
These software firms, experts say, are hiring about 6,000 engineers every quarter at salaries close to one-eighth of those paid to professionals in the US.
This is in line with a McKinsey forecast in the beginning of the year, that executives from larger multinational companies generally plan to increase their investments in China and India, and they see those countries as important sources of talent, although there are striking regional differences.
The heartening sign is that the surge in jobs isn't restricted to the IT and IT-enabled services segment, although it continues to dominate. Among the other hot sectors are healthcare and trading firms. A recent India employment survey brought out by management consultants Ma Foi has some interesting figures.
According to the Ma Foi Employment Index -- a quarterly survey analysing the employment trends in the Indian economy -- hiring by IT and ITES companies in India will go up by 13 per cent in the third quarter (October to December) of the current financial year, compared to the previous quarter.
But the figures are equally impressive for other sectors like trading firms (6 per cent) and the healthcare industry (5.34 per cent).
Overall, the survey found that the hiring confidence is upbeat with the 3,295 companies looking at creating 90,534 jobs in the quarter.
According to the survey, of the top 20 companies in the list of best hirers, nine are from the IT and ITES sector, followed by four from infrastructure, two each from pharma and manufacturing, and one each from power and consumer durables.
The survey conducted across 18 industry sectors shows that while smaller companies with less than Rs 100 crore (Rs 1 billion) turnover showed an employment generation of 6.1 per cent, the figure for those with a turnover of more than Rs 1,000 crore (Rs 10 billion) was 0.91 per cent.
Also, the services sector is growing at a faster pace than the product companies. The net hiring figures for the product companies is about 30,000 while the services sector is projecting a figure of about 35,000.
Amidst all this euphoria about the boom in jobs market, here's an important point for managements. While salaries have already gone up substantially in view of the "middle-level talent shortage," a Watson Wyatt Work India survey across 53 companies says a whopping 78 per cent of employees are unhappy with their compensation and feel that rewards are not in line with performance.