India-based Infosys announced a plan to open four US tech centers and hire American workers. However, it's unclear what the motive is and where the company will find the tech talent.
Infosys, a company known for providing IT services and outsourcing, plans to hire 10,000 US-based tech professionals to fill four tech centers throughout the country. It's great, but troubling, news considering the timing of the announcement and the continued shortage of tech talent.
The announcement was made May 2, 2017, just weeks after President Trump signed the Buy American and Hire American executive order, which is largely seen as targeting H-1B beneficiaries like Infosys. The company, however, said the move is unrelated.
"Our announcement that we are hiring 10,000 American workers is a natural evolution of how we work in the United States," an Infosys spokesperson said.
Infosys was backed up by comments Infosys CEO Vishal Sikka made to Reuters about the sudden hiring push: He said the move was unrelated and is actually the next step in several years of planning.
Of the four planned tech centers only an Indianapolis location, opening August 2017, has been announced. Where the other three will be is anyone's guess, and that's not the only question left unanswered by Infosys' plans.
Where will the tech talent come from?
Infosys projects its Indianapolis location will create 2,000 jobs by 2021--but where do they expect to find the people? It's no secret that there's a serious shortage of trained, qualified tech talent in the US, with hundreds of thousands of jobs going unfilled, and that's just in IT. Comptia said there were over 600,000 tech job postings in Q4 2016 alone.
With Dice placing tech industry unemployment at just 2.9% it's hard to see how those positions are going to be filled.
SEE: Report: US tech jobs hit nearly 7 million workers, up 3% from year before (TechRepublic)
So, will Infosys have trouble hiring? "All at once, no," said industry analyst and Constellation Research CEO Ray Wang. But, he added, "by 2020, yes ... this is a tough number to achieve given the scarce labor market as well as the type of new skills required to meet the margin requirements."
Infosys isn't clear on what types of jobs they're trying to fill, but they did say they're working on jobs related to "cutting-edge technology areas, including artificial intelligence, machine learning, user experience, emerging digital technologies, cloud, and big data."
It seems Infosys knows that they may encounter a shortage of qualified applicants, which is why they're planning to educate US hires to meet client needs. New hires, an Infosys spokesperson said, "will have access to Infosys' experienced instructors and world-class training that has seen an average of 15,000 people trained in computer engineering every year, for the last 10 years."
The news that training will come with jobs is good news for less experienced tech professionals or those looking to break into the industry. Infosys said it plans to aggressively recruit from Indiana universities and community colleges, so if you're close to earning a degree you're right in the window to find a job at the new Indianapolis center.
Are client companies going to bear the costs?
It's also unclear who will pick up the tab for the potential increase in costs associated with hiring US workers. When asked how they would avoid passing costs on to clients Infosys said "working with companies like ours is not just about outsourcing or taking cost out and supply, but it is about really bringing capabilities and innovations that no one else can bring."
It may be beneficial to US companies to have local, qualified American workers available but their statement doesn't answer the core question: Will the hiring of 10,000 US tech professionals increase costs?
Wang said the problem of higher costs won't be just Infosys' to bear: "Every IT services firm will have the same issue [with the H-1B cut]," he said, adding that companies like IBM and Accenture will feel a pinch as well.
While the announcement of 10,000 new jobs is good news for tech professionals looking for work, the remaining questions leave uncertainty about how this all will play out.
The three big takeaways for TechRepublic readers:
- Infosys announced plans to open four US-based tech centers that will employ 10,000 people. The first center, located in Indianapolis, will open in August 2017.
- Infosys denies the announcement has to do with President Trump's H-1B crackdown, despite the news coming shortly after the president's Buy American and Hire American executive order.
- There has been little information about the details of Infosys' plans. The types of jobs, three other locations, and expected costs to clients are unknown.
- Tech skills shortage: Amazon trains veterans to fill the gap (TechRepublic)
- Seven in 10 openings for key IT jobs going unfilled, study reveals (ZDNET)
- Report: 40% of employers worldwide face talent shortages, driven by IT (TechRepublic)
- Six ways to fix the IT skills shortage (ZDNET)
- H-1B visa powerhouse pledges lots of jobs -- for Americans (CNET)