The lure of attractive salaries, quick promotions, foreign posting and job mobility attracted lakhs of young students to India's top outsourcers, making India the back office of the global IT requirements.
Some of those charms faded over the last few years as the global economy saw sustained slowdown, but more recently, India's big outsourcers have bounced back as global demand picked up. What's missing, however, is the usual exuberance among employees associated with a change in environment.
"This time the usual acceleration in wage pressure that accompanies improving demand seems absent... We note the bargaining power of companies with respect to entry-level employees is at its peak with real wages at their lowest in more than 15 years," Credit Suisse said in a report.
Here's what putting pressure on salaries and hiring.
1) Capacity of engineering colleges in 2013-14 rose to a whopping15 lakh as against 6 lakh in 2006-07.
2) India is projected to grow at the slowest pace in over a decade in 2013-14. The sharp slowdown has meant reduced competition for engineering talent from other sectors, Credit Suisse says.
3) The fear of Immigration Bill and recent visa controversies has forced IT firms to hire more staff on client sites.
4) Changes in business model: Companies can improve utilisation because of increasing contribution from 'non-linear' models and some amount of automation, Credit Suisse says.
5) IT companies are increasingly turning to non-engineering graduates as the process of software development has become less complex in certain areas, Credit Suisse says.
http://profit.ndtv.com/news/industries/article-real-salaries-of-software-engineers-lowest-in-15-years-credit-suisse-373180
Some of those charms faded over the last few years as the global economy saw sustained slowdown, but more recently, India's big outsourcers have bounced back as global demand picked up. What's missing, however, is the usual exuberance among employees associated with a change in environment.
"This time the usual acceleration in wage pressure that accompanies improving demand seems absent... We note the bargaining power of companies with respect to entry-level employees is at its peak with real wages at their lowest in more than 15 years," Credit Suisse said in a report.
Here's what putting pressure on salaries and hiring.
1) Capacity of engineering colleges in 2013-14 rose to a whopping15 lakh as against 6 lakh in 2006-07.
2) India is projected to grow at the slowest pace in over a decade in 2013-14. The sharp slowdown has meant reduced competition for engineering talent from other sectors, Credit Suisse says.
3) The fear of Immigration Bill and recent visa controversies has forced IT firms to hire more staff on client sites.
4) Changes in business model: Companies can improve utilisation because of increasing contribution from 'non-linear' models and some amount of automation, Credit Suisse says.
5) IT companies are increasingly turning to non-engineering graduates as the process of software development has become less complex in certain areas, Credit Suisse says.
http://profit.ndtv.com/news/industries/article-real-salaries-of-software-engineers-lowest-in-15-years-credit-suisse-373180
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