Data from 2006's 4Q appears to indicate two things: The world still has a strong appetite for outsourcing services from India. And attrition and a shortage of qualified workers are becoming serious problems for Indian outsourcing firms like Infosys, Wipro and Tata.
Those firms are doing what they can to boost worker ranks, including looking for recruits outside India's borders.
A nonprofit called GramIT has been finding its BPO employees closer to home, in rural Andhra Pradesh state, where college-educated residents are willing to work for wages three to six times less than those of their urban counterparts. A lack of other good jobs in the region also keeps turnover minimal, to about 5 percent a year.
While the company is ramping up slowly by concentrating on Indian government agencies and other domestic clients, its CEO says it hopes to eventually be able to meet the needs of global firms.
This approach reminds us of one used by some U.S. firms, which hire workers in rural areas like Nebraska for wages that are far higher than in India, but far less than the going rate in large metro areas.
The financial tradeoff can be worth it when one considers the advantages of homegrown talent -- native language skills and better cultural fit.