Nipun Agarwal graduated from Birla Institute of Technology and Science, Pilani six months ago with a degree in electronics & instrumentation engineering and currently works as a software engineer with an Indian testing firm. For the last month, Agarwal has been living at The Void, a top “workation” destination situated near the Dhauladhar mountain range in the Himalayan state of Himachal Pradesh.
“My prime reason for coming here was to figure out what I want to do with my life,” says Agarwal. “To think about what I want to do next.” He has a lot to think about: Agarwal has received a slew of job offers in the last six months, including four in just the last month.
Agarwal is among the thousands of Indian tech workers who are currently spoiled for choices. India is currently in the midst of its biggest hiring boom in eight years — nearly 50% of Indian companies in a recent survey said they were planning to add more staff between January and March 2022.
The glut of choices for tech workers in India would have been unthinkable even a year ago. In India, where millions of new engineers join the workforce each year, entry-level jobs have traditionally consisted of a tightly monitored nine hours in the office writing basic code and earning as little as $6,000 a year. Even after the advent of startup culture in the country, working from remote locations was not the norm until the pandemic hit.
Over the last few months, however, these trends have started to change, as tech companies — startups as well as outsourcing firms — try to fill thousands of openings from the limited talent pool.
Flush with an estimated $32 billion in capital, Indian startups are vying for engineering talent and senior executives. Meanwhile, traditional IT firms are on a hiring spree after the pandemic triggered a fresh wave of outsourcing in the West. The top five IT firms in India alone — Tata Consultancy Services, Infosys, Cognizant, HCL Technologies, and Tech Mahindra — are currently hiring more than 200,000 new employees, according to one estimate.
The competition for talent — even entry-level employees — means that candidates now start out with two or three job offers, each firm outdoing the other with offers of complimentary BMW bikes, Mercedes cars, and high-growth organizational cultures.
This situation is “unlike anything I’ve seen before on many fronts,” Kunal Sen, a partner at a leading global executive search firm, told Rest of World. Sen says that the sense of panic during the outset of the pandemic led to “knee-jerk, arbitrary reactions” like layoffs and pay cuts but that there’s now been a “complete recovery” in India’s tech jobs market. “There is hyperactive hiring at all levels — junior, mid, senior. And there’s a scramble for top talent.”
Anyone with what Sen calls “contemporary digital skills,” such as cloud architects and data analysts, is in demand, as the pandemic accelerated the digitization of industries across the economy.
Engineers are making the most of the situation.
Agarwal left school with three job offers — two from startups where he interned and one from the Indian branch of a privately held American corporation. Although the pandemic led to severe layoffs across India, it also opened doors for Agarawal, who could sign up for remote opportunities he didn’t have access to before. He interned at a leading Indian fintech startup while completing his final-year thesis — working remotely with the U.S.-based MIT Media Lab — and then switched to another startup internship alongside his final semester courses. The six days of overlap between the two jobs and his college courses were “the scariest days of his life,” but, ultimately, he could choose between the offers to settle on a dream job.
Dushyant and Harish, two mid-level engineers who requested anonymity, to protect their employment, told Rest of World that they have managed to nearly double their salary packages since April this year. After deciding to move out of their jobs as senior software engineers at multinational corporations — full of “maintenance work” and “lengthy calls late in the evening” — they interviewed with multiple companies between April and August this year, incrementally increasing the size of their offers. Dushyant says he now makes close to $92,000 per year, with just four years of work experience. On average, an Indian software engineer makes around $13,000 a year, according to compensation software and data company Payscale.
Harish landed his job at a startup with the help of recruitment marketplaces like Instahyre, HuntingCube, and TopHire.
TopHire has seen its candidate pool double over the last year. “If we had about 1,000 candidates looking out actively every one or two weeks a year ago, now that number would easily be 2,500 or even 3,000,” said Ritu Mishra, senior account manager of talent acquisition at TopHire. People who were once reserved about switching jobs, especially to startups, when things were still unstable right after the pandemic started, changed their minds, starting in August last year.
This increase in the number of engineers looking for new opportunities does not mean companies can get talent cheap. “The biggest challenge is the difference in hikes that people are looking for… Two years ago, the industry-standard was a 20% to 30% hike. That has gone up to an average of 80% to 100% right now.”
With all the money in the ecosystem, “there has been an inflation in packages,” Agarwal said. “You take an offer from one company, use it to negotiate a higher one at another, take that to a third, and so on. Everyone does that right now. The tech market is so hot, people are signing offers, getting other jobs, and then saying they’re not going to join, at the last minute.”
But not everyone is enjoying this rollercoaster. For smaller startups, hiring and retaining talent has become a challenge.
“Things are very, very weird,” said Sarvesh, a founder of a 10-person startup, told Rest of World, requesting to remain anonymous because he didn’t want the nature and strategy of his work to be identified. “Hiring is difficult. To get people at the cost you want them at is the challenge. Those from tier-one colleges can go not only to the corporates like Amazon, Google, or Microsoft, who pay well [and] offer a brand name and stability but also to other well-funded startups,” he said, referencing the colloquial classification system of engineering colleges in India, based on pedigree and placement opportunities. “With about $15 million in the bank, [the well-funded startups] can offer a decent package with cash and stock options, promising a valuation that comes with a sense of mission and a vision.”
The founder has had to formulate his own hiring strategy to attract employees to his early-stage startup, tapping into tier-two colleges to fill the openings at his firm. But that has its own challenges, he says. “With tier-one colleges, you can expect to select one out of every three or four candidates interviewed, but with tier-two colleges, that is closer to one out of every five or 10,” he said.
The challenges of recruiting talent don’t end at hiring. “Employees expect regular increments [raises] too,” said Sarvesh, “so we’ve been giving out 30% to 40% hikes every few quarters, to keep moving with the market.” According to one survey, the average pay raise in tech stands near 17% in 2021, versus 9.4% across all sectors in India. And while corporate India promoted, on average, 11% of its employees annually, those in tech promoted around 17.5% of their employees.
Sarvesh says attracting talent isn’t just about money. Given the market, top firms can offer more than what Sarvesh’s company could ever offer. Rather, Sarvesh says he’s intent on selling employees on the company’s cause. “They have context into our mission; they’re clued in,” he said, also quipping, “these days, pitching to college kids is like pitching to investors.”