India Thinking Big to Tackle Talent Shortage


Last week I wrote about a study that indicates that U.S. job losses due to offshoring are offset by growing sales of U.S.-produced services in other countries. This doesn't mean there won't be "losers," say the researchers, economists Runjuan Liu of the University of Alberta and Daniel Trefler of the University of Toronto, who note that less-educated Americans may have more trouble finding jobs and remaining employed.

I cited an earlier post in which I commented on AT&T CEO Randall Stephenson's contention that the telecommunications giant couldn't find enough folks with the right qualifications to fill technical support positions it planned to shift from India back to the U.S.

Perhaps the U.S. should look to India's example. The country's outsourcing industry, which has long been portrayed as a poacher of U.S. jobs, is now struggling to fill job openings and cope with competition from lower-cost countries. Sounds familiar, yes? But while the U.S. responds to these issues with little more than hand-wringing and political posturing, India appears to be tackling them head-on.

Some examples:

  • Fostering Technologies in Rural Areas (Fostera), an initiative designed to create jobs for residents of India's rural districts, has found outsourcing jobs for nearly 200 young people from poor families in four villages, reports Hindu Business Line India. BPO provider Adventity just signed an agreement with Fostera to undertake a pilot employing 100 program participants. If the pilot is successful, Adventity could hire up to 1,000 more participants within two years. Frontera recently hosted representatives from companies including HP, Cognizant and Syntel. The program's creator, Santhosh Babu, tells Hindu Business Line he was "initially skeptical" the model would work. But now he believes it can be duplicated across the country. The only hitch, says Babu, is a lack of ubiquitous broadband connectivity. Frontera is addressing this with plans to introduce WiMax to participating villages.
  • India hopes to further leverage its rural areas by building 43 new information technology cities across the country to attract workers for the IT outsourcing and BPO industries, reports the Times of India. The idea is to create self-contained cities with commercial space geared toward the needs of those industries, followed by infrastructure investments in residential housing, education, health care, retail and recreational facilities. Also addressed will be access to airports and larger metropolitan areas. India's government wants to shift 40 percent of the country's outsourcing business, which is currently concentrated in seven cities including Chennai and Bangalore, to the new cities by 2018. All together, it hopes the cities will create employment for some 3.5 million people. Based on the article, it sounds as if private investors will be expected to provide much of the funding, with state governments expected to make the necessary investments in services such as sewage, drainage and utilities like water and electricity.
  • Government initiatives aren't the only way to address worker shortages and competitive pressures. NIT, a talent development and training company, is teaming with services provider Genpact to create an Institute of Process Excellence to supply employees with industry-specific skills. Vijay K. Thadani, NIT's CEO, says the institute will cover subjects not necessarily stressed in college, including such "soft" skills as business processes, voice training, language skills and business communication, as well as specialized finance, accounting, banking, insurance and supply chain training.The two companies intend to have 250 training institutes across the country by 2012, reports Hindu Business Line India. If the program is successful enough, they hope to expand it to the Philippines and China.