Whither global dreams?

Sudipta Dev/ Mumbai

• UK ends fast track work permits for IT staff
• US to cut H1-B to 65,000
• Suspension of priority processing for IT professionals in Australia
• Germany to impose new immigration laws

For Indian IT professionals living a global dream, these media headlines are enough to shatter their hopes of pursuing a career in a choice international destination. Once wooed by all countries, the post-slowdown era has brought about a different scenario altogether. The preferential visa permits that have been doled out to them in the last couple of years are gradually being withdrawn and all indications are that next year might be tougher still. The pertinent question is: What are the other alternatives, even if somewhat poorer? There are many, assure recruitment market experts, though the golden days will never return.

On August 21, 2002, the Home Office in UK studied the current status of the IT labour market and decided that there will no longer be a shortage list for IT professionals in the country. With effect from September 1, 2002, it has been necessitated that all IT work permit applications must show that the work has been advertised in either a national newspaper or a relevant trade journal. Like UK, Australia has also ended its fast track processing for IT professionals. Priority processing was introduced in the country on February 1, 2001, as a result of shortage of skilled manpower in this field. It took four-six months to process migration visa for IT professionals. Now it will take the normal 12 months or more. In a recent announcement, the Australian Labour minister Tony Abbott had said that job opportunities in the ICT industry have stopped growing and unemployment rates have risen sharply in the last 12 months. Employers can however continue to sponsor skilled overseas workers if they are not available locally. In the US, come September 30, 2003, and the H1-B visa quota will be reduced from the prevalent 195,000 to 65,000, which was the figure prior to the 1998 H1-B law known as the American Competitiveness and Workforce Improvement Act (ACWIA).

In June this year the much controversial immigration law was passed in Germany, which will come into effect from January 1, 2003, drafted to control the number of foreigners entering the country. Pointing out that the law also mentions attracting specialists in certain fields, the German ambassador to India, H E Heimo Richter, says, “It is a question of demand, when the Green Card was created there was greater need than today. One has to see what will be the balance sheet in the next year. While we do not foresee closure of door but only those will be invited for posts that can’t be filled by Germans.”

Recruitment experts agree that it is a matter of demand-supply perspective, that is when the demand for a particular skill is available within a country, it does not feel the need to import talent. Says Dhruv Shenoy, vice president, marketing, Monsterindia.com, “We believe that most countries are putting together systems to support employment initiatives for the local populace and in this process it is likely that the employment opportunities for Indians might diminish.”

Impact on employers

While tighter regulations will enforce employers in those countries to look locally, it might however not impact large Indian companies wanting to send their staff abroad. Most Indian IT houses with branches in the US use L1 visa for intra-company transfers, which will not be affected by the H1-B quota. Contract staff opportunities though, whether directly or through Indian IT companies, might be impacted. If an Indian company sends staff for an onsite project to the US, the client sponsors the H1-B. However, minus the frenzy witnessed in the 1998-2000 period, the 65,000 H1-B cap might not actually be a problem for these companies.

Organisations like Mastek send their staff for onsite work on H1-B visas. Ashank Desai, the chairman and managing director of Mastek, says, “In the UK these restrictions might be serious, but in the US it won’t have the same impact. The main reason is that there are options for more and more offshore work.” He also feels that the career prospects for Indian software professionals will remain the same. “We should look at it from macro viewpoint. Most who pass out of Indian schools eventually settle in India, and it is only those people who want to go out for a short-term who might get affected,” adds Desai.

Deepak Gadekar, vice president-human resources, Atos Origin, points out that the restrictions will affect those companies which do not have local offices in that particular country as the customer might not be willing to process the visa. Atos being a part of a global conglomerate sends its staff to the US on L1 visa. Gadekar is sure that the opportunities for the highly skilled will not change. “Those who are good will ensure that they are saleable anywhere, but this will certainly affect those who want to go for a short while and make quick money.”

The HR departments of various Indian companies have now started taking the regulations into account. Kris Lakshmikanth, CEO and managing director of Bangalore-headquartered The Headhunters India, admits that organisations are now focusing on more and more offshore projects. “Secondly, where they are required to work ‘onsite’ as in case of ERP implementation projects, they try to use local resources. For instance, in the US they are doing a lot of Oracle ERP and SAP implementation work. The people they recruit for these are Indians who are currently in the US. Only if they can’t get such people they look at India,” adds Lakshmikanth. He states the instance of a top recruiter—an Indian company with presence in the US since 1998, who has stopped looking for people from India. “Today they are looking for people within the US. Further, the salaries they are offering have come down by 15 percent to 20 percent.”

Other alternatives

The best alternative is to search for opportunities in countries that are actively trying to attract Indian talent. “Countries where the economy and the IT industry are growing will provide alternative opportunities for global careers. These include African nations, the Gulf and some Asian countries,” says Satish Doshi, managing director of Sampoorna Computer People and chairman of Executive Recruiters Association (ERA). Nations like South Korea, China, Japan, Malaysia, Singapore and Middle East countries will offer more and more openings for Indian software professionals, admits Lakshmikanth. It has therefore become imperative for software pros to learn languages other than the technical ones. For instance, even some basic knowledge of Japanese, Chinese, or Korean will make it easier to find jobs in any of these countries. “As you are aware South Korea and China are doing very well. Malaysia wants to establish itself as a major knowledge power. Same is the case with UAE. While salaries in these countries may not be like USA salaries, nor living conditions like the US or Europe, still they will be much better than Indian salaries in terms of `post tax’ or `savings potential’,” he says, pointing out that the salaries in the US have considerably reduced since 1999. While earlier a software professional from India with three to five years of experience could fetch between $60,000 to $70,000 per annum, now it has come down between $45,000 to $50,000.

The other option is to re-skill themselves to a higher level where the demand for them would be inevitable, insists Shenoy. Evidently, there is no stopping the best in business. “High potential people will have no problem. They can get jobs anywhere,” agrees Rajaram Agrawal, managing director of Talentahead India. Tarun Bali, CEO of ABC Consultants also feels that good candidates may be able to get through, particularly since Indian companies having their development centres in countries other than the US may not be affected much by the visa restrictions.

Doshi acknowledges that the economic recession and its impact on the industry has resulted in a lot of pain for IT professionals. Yet he believes that this is definitely a boon for the Indian IT industry since global companies will increase offshore and outsourcing work from India and thus create more job opportunities for Indian software professionals. As predicted by Nasscom, India might actually witness a skill shortage in the next few years with more and more MNCs looking to hire locally in the country. “The lack of H1-B quotas will therefore not have a big impact in India. Some examples of large hiring waiting to happen are: Xansa India plans to recruit 10,000 plus by 2007; Oracle will recruit 2,000 or more and EDS is looking at expanding five-fold from current levels,” informs Bali.

Currently in Michigan, US on an assignment to interview senior level software professionals for Indian companies to be based out of India, Lakshmikanth says that the response he has got from has been nothing short of “phenomenal”. “I am in touch with very good Indian professionals in the age group of 29 years to 42 years range—engineers, MBAs from good colleges universities—who want to return to India. The main reason being the lack of opportunities in the US or Europe now. Things are bound to change with time but it is ‘Asia’ time right now,” says he.

It is probably the time to remain at home or look closer home. Shanghai, Singapore, Kuala Lumpur, Dubai, Hong Kong are all happening destinations which are certainly much more welcoming.