Outsourcing Update? India Faces Labor Shortage

July 14, 2007 by Chuck | 2 Comments

India has unique advantages for companies wishing to outsource from the United States. Other nations don’t share at least one of those advantages. Formerly part of the British Empire, there are a large number of English speakers in India. There is a low cost of living. So lowering costs by shifting work there was a “no brainer” for many US firms.

Has the gravy train started to run out? That’s what I wondered when I saw this headline: “India Struggles With Labor Shortages”

From Forbes

[The conclusion of the article...] 

And for foreign companies, it no longer makes sense to outsource a few hundred jobs to India, says Oberoi. With the increase in wages as well as the cost of setting up in a big city like Mumbai, Delhi or Bangalore, “the market is now all about scale if outsourcing is to be cost effective,” he says.

Recruiters say the only new source of skilled labor is overseas Indians attracted back by the booming economy. Indians in the Middle East and Far East are coming home, as are expatriates from destinations like the U.S. and the U.K.

In Trends

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