Infosys, other Indian IT firms discovering benefits of hiring locals in US

Infosys to gain $31 million if it manages to hire 2,000 people from the American state of Indiana

Indian information technology (IT) firms led by Infosys are now discovering that states in the United States (US) are offering incentives, including tax grants, to improve local employment.

Infosys will gain as much as $31 million if the company manages to fulfil its commitment of hiring 2,000 people from Indiana state. Infosys has committed a total of 10,000 jobs in the US as it increases local hiring to mitigate challenges of protectionism from President Donald Trump's administration and starts engaging with local clients.

"While some may view this as giving into the President’s policies, it’s not different from how the Japanese automakers shifted production from Japan to the US in the 1990s,” said Ray Wang, founder and principal analyst of Constellation Research, a SilicValley-based technology research firm, in a recent interview.

In the 1990s, US states competed with one another to attract Japanese auto firms like Toyota to locate plants and offered incentives of as much as $1 billion to promote local employment. The move helped firms to decide on a location to set up plants, helping them localise production and sell American-built cars to its customers.

Along with Infosys, firms like TCS, Wipro, HCL Technologies are collaborating with local universities and schools to train students in science and technology so that there is a bigger pool of graduates who can join them locally.

“A big percentage of this hiring will come from the local universities. We have done it before... Now we are planning to do it in a large scale. Wherever we need to deploy people immediately, our preference will be experienced people. We have to do a combination,” said Pravin Rao, chief operating officer, Infosys.

The US government has over 2,000 programmes on offer for potential employers to set up local bases in different parts of the country. The US also has a liberal visa regime where green card is issued to those people who will invest at least $1 million in a business, generating jobs for 10 locals in a region.