It's a win-win situation for both software engineers and startup companies. While startup companies are looking to hire experienced and skilled professionals, software engineers are making a beeline to join startups. Given the current economic situation in the country and the subsequently low recruitment and layoffs by established companies, a large pool of professionals is available in the market. So what attracts these professionals to startup companies?
Srikanth M, a software engineer at Vensys Software Solutions and previous employee of Wipro says, "Currently there are a lot of job opportunities in startup companies. Also at a startup company it is a totally different experience as you get to learn a lot more." Ashok Babu Gopireddy, also a software engineer, currently unemployed agrees. "The work will be more challenging in a startup, the scope to learn being larger. It will be a new experience altogether and you will get to develop your skills from the beginning", says Gopireddy.
Startup companies find it beneficial to hire these professionals, for various reasons. Experience is certainly a major advantage. Prashant Honnavar, the HR head at Nextbit Computing, a company that develops intellectual property and solutions for data enabled consumer electronics and handheld devices, says, "It is beneficial to the startup company if it hires people with experience of two to five years. Due to the slowdown, a lot of experienced workers are available these days and it makes sense to take advantage of the situation and hire these professionals."
The other reason given by companies to hire experienced workers is, to cut down on training costs. Kumar Ritesh, CEO of GSEC1, a company that provides innovative solutions for the entertainment industry says, "When you hire freshers, you have to spend on training. This is not only costly, but also time consuming. Thus we prefer the experienced pool of professionals."
More and more professionals are thus looking at startups for a new experience and as a learning platform. The fact that startups are keen to hire them makes it an added advantage for these professionals. In a startup, an employee gets an all-round experience, from engineering to management. Also it will take less time to climb up the ladder.
Consultancy firms feel that there is a strong motivation for professionals to move into startups in the current scenario. Srikrishna S Murthy, founding member of Longhouse Consulting, which is at present doing a study on 'the process that startups go through, while hiring senior professionals' says, "There are very few professionals who don't want to consider a startup now. One of the reasons is that, whereas growth in a MNC can be stagnant, it has better scope in a startup. However the shift is mainly of tier two and tier three employees. This can largely be attributed to the current layoffs."
The question is what is software industry body Nasscom doing to ensure that startups get the right talent? The answer is: absolutely nothing. An official of Nasscom promoted India Innovation Fund says, "At this point of time, we aren't doing anything specific to ensure the right talent for startups, as we feel that there are more pressing needs like funding and mentoring that need to be addressed. Besides getting the right talent for startups is something that market forces are now taking care of and dosnt need intervention."
The unauthorized software copying has increased the losses to $53 billion and it has also become a bar for more employment generation. As per a study, lowering the unlicensed usage of software by 10 points for four years would create six lakh jobs world wide and around 43,000 jobs in India alone.
The findings based on a study by the research firm IDC also maintained that the restriction in such usage would also pump $3.1 billion in the economy and $200 million in tax revenues. The local vendors also bear the brunt for unauthorized software copying, as the lowering of the unlicensed software usage would bring additional $2.7 billion in revenues to them.
In 2008, the worldwide PC unauthorized copying rate rose for the second year in a row, from 38 percent to 41 percent, mainly because PC shipments grew fastest in high-unauthorized copying countries such as China and India, overwhelming progress in these and other countries. The projection has been confirmed by actual experience in China and Russia. Also, according to the study, reducing unauthorized copying by 10 points would generate $24 billion in higher government revenues without a tax increase.
The world's top cellphone maker Nokia Oyj said on Tuesday it plans to cut a further 490 jobs as part of its global cost cutting programme.
The Finnish firm said it would cut 170 jobs in logistics, production management and production support and would offer a voluntary resignation package for up to 320 employees working at its Salo plant in Finland.
Nokia, which made its first ever quarterly pretax loss in January-March, is cutting annual costs at its key handset unit alone by more than 700 million euros ($948.7 million) to counter plunging demand.
The overall mobile phone market is expected to shrink 10 per cent this year, as consumers rein in spending and handset sellers try to clear out unsold phones.
Including the job cuts announced on Tuesday, Nokia has slashed some 4,000 jobs across the organisation this year.
H1-B, IT market, NRIs, Outsourcing
With India and America sharing both principles and interests, a leading US columnist wants President Barack Obama to stop "neglecting" India and visit India soon saying it would pay "very rich - and very reliable -dividends."
"What is significant is that the convergence of India and America rests just as much on shared principles as it does on shared interests," writes Tunku Varadarajan, a professor at New York University and executive editor for opinions at Forbes magazine.
"As Pakistan tears itself apart, America needs India more than ever. The moment, therefore, is Obama's to seize," he said citing an Asia Society report emphasising, "India matters to virtually every major foreign policy issue that will confront the United States in the years ahead."
"As an Indian who has made his home in the US, I say to Barack Obama: Don't neglect India. Go to India, and go there soon. Or if you can't leave town, invite (Prime Minister) Manmohan Singh to stop by," Varadarajan said. "This is an investment of your time that will pay very rich - and very reliable - dividends."
"Obama's handling of the financial crisis, his stewardship of America's foreign and security policy has been surprisingly deft. But the one part of America's foreign policy that Obama can be argued to have flubbed so far is its relations with India," he writes suggesting since taking office in January, Obama has paid India scant attention.
There are two ways to read Obama's neglect of India. The first reading - one that gives him the benefit of the doubt that he's not keen, by disposition, on India - is that he was maintaining a prudent distance from New Delhi as India went to the polls, he said.
The second, darker reading of Obama's coolness toward India rests on a sense that the president is punishing the Indian political establishment for its closeness to former President George W. Bush.
"Yet if there is any pique at all in Obama's approach to India, he needs to get over it fast," Varadarajan said. "The alliance is too valuable to jeopardise. In Hillary Clinton, the president has a secretary of state with a real feel for India."
NRIs
Last November, Abhimanyu Gupta, an MBA student in New York University’s Stern School of Business, was on the top of the world when he landed a job offer from Bank of America’s investment banking division. This February he felt right at the bottom of the abyss as the bank withdrew the offer and Gupta’s world cratered just like the global markets.
Now, the 27-year-old chartered accountant, who left his home Mumbai in 2007 to become an investment banker in the world’s financial capital, plans to return home if he doesn’t get an offer by June when his course ends.
With five months of recruitment time gone, Gupta concedes that his chances of finding similar job in the US, which is battling the worst downturn in decades, are bleak. His chances are as bleak as hundreds of other Indian and foreign national students across top universities in the US, UK and other western economies, who now plan to go back home.
The Harvards, Whartons, NYU Sterns, Kelloggs, MIT Sloans, Michigans and Dukes – the dream destinations of students till the other day – no longer guarantee top-dollar jobs. One year of downturn has turned the students’ world upside down.
According to a recent study by the University of California, Berkeley, almost 84% of Indian students and 76% of Chinese students in the US think it will be difficult to find a job in their field in the country.
Even lenders are tightening the noose on international students. First-year MBA students, who were relying on loans from US banks to fund their second-year expenses, are in trouble because the banks have stopped lending to international students without co-signers.
Some students say the Obama administration’s move to put visa restrictions on companies accepting Troubled Asset Relief Programme (TARF), a bailout fund set up by the government to help US companies come out of the downturn, too has hit international students’ prospects there.
Now, most Indian students in the West are betting on their home country. “Not getting an offer there, they are looking homewards. Given the economic health of the US, India seems a better option right now,” says Brijtendu Sarkar, chief restructuring officer at Birla VXL, who did his MBA in general management for senior professionals from London Business School (LBS) last year.
The US has been in recession for 18 straight months now and has lost 5.1 million jobs so far. The world’s largest economy shrunk 6.1% year-on-year in the first quarter of 2009, following a 6.3% decline in the last quarter of 2008. A recovery is unlikely before the end of the year even in a best-case scenario.
Indian economy, which has seen a slowdown after growing at over 9% for three years on a trot, is still expected to grow at a healthy pace of 6-7% in the current fiscal. India and China, the other emerging giant, are expected to bounce back faster and drive a global recovery.
In fact, according to the University of California study that surveyed 1,224 foreign nationals from India, China and Western Europe, almost 86% Indian students and 74% of Chinese students believed their home countries’ economies will grow faster in the future than they have in the past decade.
Most students coming back home are scouting for openings in sectors where they came from, as switching industries makes it difficult to get jobs. Some are approaching their seniors settled in India. Mr Sarkar himself has got three such requests.
According to Mr Sarkar, a number of Indian students in his batch read the signs early and returned home last year, to be lapped up by a booming Indian industry. Now they are helping their juniors search jobs in Asia, he adds.
While it may be easier for these students to find jobs in India, salaries here are not very attractive for most of them who are sitting on huge education loans. An MBA in a top western university costs anywhere between Rs 40 lakh and Rs 60 lakh. Also, many Indian students in the US are married and have a family to support.
Convinced that a job in India won’t earn them enough to pay off their debt and support families, some students like Arihant Chowdhury (name changed) are delaying their degrees to buy time.
The 30-year-old Michigan University’s Ross School of Business student, who didn’t get a job offer in campus placement, has delayed his graduation by six months and continues to work with a small firm where he interned. In case he doesn’t get an offer next season, Chowdhury will return to India and start his own business. He said 10-15 Indians in his batch are yet to find a job.
Even those who have found jobs this year — such as Saptarshi Ganguly of MIT Sloan who is joining McKinsey and Kaustubh Jagtap of NYU Stern – agree that the situation is quite grim. Most of the students say there has been a drop of 20-25 % in the average salary. And the quality of the jobs too has slipped. “I believe most of the students graduating during recession continue to suffer throughout their lifetime. They have to make choices about career paths that they wouldn’t have even thought in normal times,” says Jagtap, who is joining a hedge fund in New York.
A number of small and boutique companies, who never had access to top business schools earlier, are now hiring from campuses, they point out.
Little wonder then, the number of applicants for global Bschools has dwindled of late. Students prefer a seat at top Asian schools like China Europe International Business School (Ceibs) in China, Indian School of Business, National University of Singapore and Asian Institute of Management in the Philippines. “These institutes are at par with some of the best schools globally and the cost is far lower.” says Rajat Chowdhury, product head, international education, IMS, one of the top coaching institutes in India.
That doesn’t mean the London School of Business, Wharton and Harvard have lost their appeal though. Students unanimously agree what one learns in these centres of excellence is unparalleled and that products of these institutes will get their dues in the long-term . At least, that’s the hope the Guptas and Chowdhurys live with today.
Cost cutting, Infosys
The cup of troubles for tech employees is overflowing. After companies have cut-back on salaries and perks given to employees, Infosys Technologies is planning to withdraw its home loan facility for employees with effect from 1 July, according to an internal mail from the company.
Infosys, which values each employee at nearly Rs 1 crore, has been providing interest free home loans to needy employees for several years. So far over 2,000 employees (with experience of five years and above) have availed the loan facility accounting for a cumulative disbursements of Rs 80 crore, company officials said.
However, later the scheme was converted into an “interest allowance,” wherein a portion of the home loan interest is borne by the company, which could be considered as an equivalent of a perk.
