India: Half a world away, but can't be counted out.

Less than 10 years ago, people would have been considered insane if they even suggested that young people in India would soon be competing with young Americans for American service jobs!  India is on the other side of the world and it would have been horribly impractical to rely on foreign voices that are frequently hard to understand for Americans... especially due to the time it took to transmit information around the globe!!

Things have definately changed, however, and today Indian workers are legitimate competitors.

  In 1999, high-speed optical fiber cables connected India to America at a speed of 3 megabits per second.  Instantly, data transmissions that used to take forever on the slow 64 kbps connection (dial-up), would take less than 2 seconds to cross 12 time zones. In one year, foreign investment in India shot up from $5.6 to $8.4 billion dollars and hasn't stopped rising.

Today:

• 200 million Indians speak English and perhaps 40 million of them speak it fluently as their first language with only a trace of the usual Indian enunciation.
• The tiny wages (compared to Americans) earned by employees at off-shore facilities are considered so high to many Indians that conservative Hindu parents are willing to relax their many taboos so that their daughters can come home in the early hours of the morning after spending the whole night talking confidently to foreigners.
• Accent neutralization classes teach ambitious English-speakers to sound exactly like a Midwestern American or Canadian and to use power phrases like "trust me, it will work" in order to gain the condidence of customers calling from the US and to disguise the outsourcing of a call center.

As a result, more and more US companies are flocking to India. And not just to fill low skill jobs!

• GE employees 15,000 Indians in it’s call center and back office processing operations. It also has one of its biggest research and technology centers in Bangalore that employs several thousand Ph.D scientists who work on the cutting edge of the whole range of GE projects
• Intel employs 1,800 PhD electrical engineers and computer scientists who are designing Intel’s next generation of microprocessors. A main reason Intel is employing people in India is not just the savings, but because Intel can not find enough qualified employees in the US.
• AOL’s call center employees in India make only $300/month compared to the $3000-$5000 a US employee would make.
• Tax accountants in the US are moving their entire data processing operations to Bangalore, where the taxes will be calculated for a saving of 80%.

India is no longer just a low-cost, low-quality alternative to employing workers in the US.  With its highly-educated population, British-style education system (in English) and hoards of ambitious young people who see offshored jobs as their ticket to a better life, India is presenting a legitimate challenge for young Americans seeking to enter the job market in the next 10 years.

Want more information on this?  Try Thomas Friedman's The World is Flat or Clyde Prestowitz's Three Billion New Capitalists. Or stay tuned!

Comments

[Prospero]

Spooky! I just responded to your online questionnaire about what advice I'd give to graduating students - suggesting that they thought about how they would compete with India and China, and your most recent post is on the same topic. It's clearly food for thought for students.