Vani Doraisamy

Report foresees shortfall of 0.5 million qualified employees

CHENNAI: One always knew this was happening, but now the National Association of Software and Service Companies (NASSCOM) has put it down in cold statistics: the IT industry in the country could be running out of "employable talent," especially where new recruitments are concerned.

The latest report from the NASSCOM stables on the state of the IT industry, `Extending India's Leadership of Global IT and BPO Industries,' foresees "potential shortage of skilled workers in the next decade or so, particularly in the BPO industry, [as] currently only 25 per cent of technical graduates and 10-15 per cent of general graduates are suitable for employment in offshore IT/BPO industries."

The report by NASSCOM the nationwide forum for software and services industries was prepared in collaboration with management consultancy firm Mckinsey and Company.

The talent crunch could have a spin-off on India's emerging position as the global offshoring leader with a market exceeding $ 300 billion. This lead is sustainable if the IT/BPO sector continued to grow at an annual rate of above 25 per cent.

The problem, however, would lie in harnessing a talented workforce. At present, India alone accounts for 28 per cent of IT/BPO talent among 28 low-cost countries but it would need a 2.3 million-strong workforce by 2010 to maintain the current market share. NASSCOM projections indicate a potential shortfall of nearly 0.5 million qualified employees, nearly 70 per cent in the BPO industry alone.


With competition for global offshoring contracts intensifying, "the country lacks large numbers of workers fluent in French, German, Japanese and Spanish, making China and Eastern Europe more attractive offshoring destinations for Japanese and West European companies respectively."

To bridge the demand-supply gap, NASSCOM suggests setting up of focussed higher education zones, deregulating higher education in stages and switching over to a demand-based funding system for colleges and universities.

Placement industry sources, however, say there is a mismatch between the job projections for the sector and the numbers actually available, not to speak of the poor quality of programming.

Quoting Microsoft chief technical officer Craig Mundie's statement "only 25 per cent of Indian software programmers are employable" a placements professional says: "Indian programmers have 10 lines of error per 100 lines of code, vis-à-vis one [line] for their American and Western counterparts."

Bench numbers

Also, "the numbers of available jobs are always ramped up because the idea is to keep the bench numbers as low as possible below 15 per cent on an average. This planning is never perfect and as a result the number of hires a year almost never matches the numbers announced or planned," he adds.