If the predicted recession hits the US, it will slow the growth of the IT sector in general. However, this could be quite beneficial for some companies in India, particularly those in the IT hubs of Hyderabad, Bengaluru, and Pune.
This is due to the fact that many companies could outsource work to, thereby creating job opportunities. Furthermore, the type of work being outsourced to India has progressed beyond just voice-based call centers.
More work will come to India, including Hyderabad, according to Manisha Saboo, President of industry body Hyderabad Software Enterprises Association and Infosys Hyderabad SEZ Centre Head. Opportunities will exist in animation, semiconductors, and new segments such as the Mobility Valley.
Hyderabad will remain appealing due to the presence of a thriving IT and startup ecosystem. Companies will have no trouble finding the necessary skilled talent here. The Telangana Academy of Skills and Knowledge is also working to train the workforce to meet industry demands.
Apart from that, she said, the State government is undertaking various developments that will enable the creation of quality infrastructure, which will be a driving factor of growth, and that Hysea was also working with colleges as part of its talent management efforts.
“We see more companies setting up their Global Capability Centres (GCCs) here. Several companies have already announced their GCCs here in recent times. These centers create global products and solutions. Among others, embedded technologies will be a key aspect as there is a rise of connected devices. They will also focus on security and access segments,” said Saboo.
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“The outsourcing scale can be large. For instance, instead of assigning a part of work to the companies, we see the possibility of the entire IT department getting outsourced,” she said.
Previously, outsourcing was only done because of the cost arbitrage provided by Indian companies. Even as this trend continues, more companies are outsourcing work to India in search of higher order skills to handle research and development, product development, and similar tasks, which are at the top of the outsourcing value chain.
Several industry experts and veterans are returning to India after spending time in the US. “Working with such people will be beneficial for companies as they are acquainted with business culture and negates the need for reorientation,” she said.
Rajiv Chilaka, President of the Telangana VFX, Animation and Gaming Association (TVAGA) and Founder and CEO of Hyderabad-based Green Gold Animations, stated that the city is also benefiting from the work-from-home culture that is still prevalent in other offshore markets. Seeing as they are not yet working from offices, some orders are being outsourced to Indian cities such as Hyderabad. According to him, the majority of employees in companies in Hyderabad have resumed work from their respective offices.
With companies here using new technologies such as the Unreal Game Engine and the State government focusing on skilling aspects of the trade, he said, Hyderabad was already getting some high-end post-production assignments.
“The hiring trend is positive in automotive, IT, solar, electric vehicles and technology. Within technology, the IT services segment is cautious as many are factoring a possible recession in the US. If recession happens, the growth plans of IT companies will be affected. However, recession will also increase outsourcing to India,” Deepak Agrawal, Co-Founder and CEO of TurboHire said earlier.
Outsourcing will also increase the demand for office space, which will benefit the real estate industry.
However, employees working in the US will be at risk because a large number of companies in the country have announced or plan to announce job cuts.
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