IT Industry – The Great Indian Labour Shortage

The practical reality is that anyone in India who can spell Java already has a job.

This statement in BusinessWeek BlogWatch caught my eye. Code Craft is a blog run by Kevin Barnes, an expat working in the IT industry in Bangalore. Kevin has written a detailed post about the practical problems he is facing in recruiting quality coders / programmers. Any magazines / newspaper worth its salt has written elaborate articles about the steady stream flow of quality engineering graduates in India. But it looks like the situation on the ground is slightly different. Is the Indian IT party over?

I didn't move to Bangalore because someone made me. I dropped out of business school and moved to Bangalore with my wife and two kids because I had the opportunity to come and help build a team here and because it was something I wanted to do.

The biggest myth is that India is chock full of highly trained and unemployed engineers that are practically begging to do your work.

The practical reality is that anyone in India who can spell Java already has a job. When we were first doing interviews I remember one particular period of time when there were two of us doing interviews continuously for two weeks straight without finding a single candidate worth bringing back for a second round. Admittedly I can be a tough (and technical) interviewer, but I've literally interviewed thousands of people over my 18 years in the industry and I've never had a tougher stretch. It reminded me of the internet boom years when everyone who had ever been a system administrator was suddenly a programmer and when you did find someone really good they wanted 3% of the company and a signing bonus. The only difference is that the current Indian market is ten times more difficult.

Ultimately we were forced only to interview people from the elite schools of India (IITs and the former RECs) in order to find a sufficiently high percentage of reasonably solid candidates to be able to wade our way out of the sea of me-too “engineers.” Even with this approach our hit rate for finding good engineers was much lower than I would have expected. It's not that good candidates don't exist from other schools it's just that you have to interview too many bad candidates to find the really good ones.

The problem is most emphatically NOT that Indians are bad engineers. I have hired some truly great (world class) engineers here, but they are very hard to pick out from the sea of less than stellar candidates.

The problem is purely economic. The demand has outstripped the supply for good engineers and as a result people who have no love for code (or even any like for it) have rushed in to fill the gap.