Infosys, India’s second-largest IT services and outsourcing company, announced on Tuesday that it would hire 10,000 Americans over the next two years, Madhura Karnik reports at Quartz, ostensibly in response to the Trump administration’s desire to crack down on the use of H-1B skilled worker visas:
The Bengaluru-based firm will also set up four technology and innovation hubs across the US, Infosys said in the release. The first one will be opened in Indiana in August and is expected to create 2,000 jobs by 2021.
“In helping our clients improve their businesses and pursue new kinds of opportunities, we are really excited to bring innovation and education in a fundamental and massive way to American workers,” Infosys CEO Vishal Sikka said in the release. “Since joining Infosys nearly three years ago, it has been my personal endeavor to help us get much closer to our clients, to co-innovate with them, on their most important business problems,” he added. Other IT companies, too, have been preparing to deal with the H-1B issue, filing fewer visa applications and increasing local hiring.
While the administration has yet to make any changes to the rules governing the distribution of H-1Bs, it has threatened to prosecute employers who overlook American workers and hire H-1B visa holders instead. US President Donald Trump has been sharply critical of the visa program, and there is bipartisan consensus in Congress that it is in need of some kind of reform. This has been unwelcome news for Indian IT professionals and the outsourcing companies that employ them by the hundreds of thousands, which take the lion’s share of H-1B visas each year.
Nonetheless, Infosys says the decision was a long time in the making, and not a reaction to Trump’s policy agenda, Wired’s Issie Lapowsky observes:
“We started to think about hiring locally at a much larger scale two years ago,” says Sikka. “This is a culmination of that.” … Sikka says that as technology itself becomes more complex, Infosys clients now demand new levels of expertise from their tech talent. “People are no longer just interested in doing the same thing, just cheaper,” he says. …
Sikka joined the company in 2014 and has since taken several steps to demonstrate Infosys’s commitment to hiring domestically. For example, the company launched the Infosys Foundation, which advocates for computer science education in schools. Still, he says Infosys has no plans to scale back on its H-1B workforce even as it grows its American one. “My view is that you have to bring the right skills and people with the right expertise from around the world to bear on different projects,” he says.
Furthermore, Quartz’s Devjyot Ghoshal adds, the prospect of H-1B reform is hardly the only challenge facing India’s IT companies today:
For one, America is looking anaemic. The US is the single-largest market for India’s IT industry, accounting for around 60% of total revenue. But it is now stalling, having decelerated to its slowest year-on-year growth in the past four years, according to Japanese brokerage Nomura. Combine that with the H-1B visa row and you’ve a mess to deal with.
Then, there’s the issue of key service lines slackening. Two of the largest revenue generators for top-tier Indian IT firms—application development and maintenance (ADM), and enterprise solutions—are continuing to slow down, according to Nomura. ADM growth is down to 3% year-on-year, while enterprise solution has dropped to 6%, with no signs of revival. “The aggregate contribution of these segments is (approx) 57% for top-three Indian IT names and sluggishness here remains a key drag on overall growth,” Nomura research analysts Ashwin Mehta and Rishit Parikh wrote.