Hiring staff in India may not be worth it
Salaries of engineers in India have risen strongly — as they should — but apparently enough for several U.S. companies to give up on the idea of hiring there.
The WSJ has a notable story (subscription required) about the trend, worth reading for start-ups with investors pressuring them to hire abroad for cost reasons. It may not be worth it any more, with salaries for software engineers officially growing at 10 to 15 percent a year — but with some people saying it is more .
…Three months ago, Munjal Shah reversed a bit of that shift. Shah, who leads a California start-up called Riya Inc., had opened an office in India’s technology capital of Bangalore in 2005, hiring about 20 skilled software developers. The lure was the wage level: just a quarter of what experienced Silicon Valley computer engineers make.
Then Indian salaries soared. Last year, Shah paid his engineers in India about half of Silicon Valley levels. By early this year, it was 75%. “Taking into account the time difference with India,” he says, “we weren’t saving any money by being there anymore.” In April, Shah shut down the Bangalore office…
The story lists a bunch of other companies making similar moves, including Kana Software, of Menlo Park, Calif., Teneros, of Mountain View, Calif., Apple, of Cupertino, Calif.
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About the Author, Matt Marshall
Matt launched VentureBeat in September of 2006, with the realization that no one else was covering the entrepreneurial and tech innovation scene with the velocity or depth that he was. Prior to founding VentureBeat, he covered venture capital for the San Jose Mercury News from 2001 to 2006. In 2002, Matt was awarded "Journalist of the Year" by the Northern California Society of Professional Journalists. Prior to working at the Merc, he was a correspondent for the Wall Street Journal in Bonn, Germany from 1995 to 1998, and a writer for the Washington Post in 1994. Matt holds a PhD in Government and an MA in German and European Studies from Georgetown University. In addition to VentureBeat, Matt is also the Executive Producer of DEMO, the leading launchpad event for emerging technologies.
