Bangalore wages can grow 750% in 3 years

steve · #1 (**permalink**) 05-24-2007, 01:54 PM

Recognizing Deven: Episode 26 - India grows up

Lots of interesting details here:

Quote:

Bangalore wages have just been growing like crazy. To give you an example, there is an employee of ours who took the first 5 years of his career to get from 1% to 10% of his equivalent US counterpart. He then jumped from 10% to 20% of his US counterpart in the next 1 year. During his time with us (less than 2 years) he jumped to 55% of the US wage. In the next few months we would have had to move him to 75% just to “keep him at market.”

In fact the wages are getting so high the owner is moving his firm to California:

Quote:

However, this huge run up in the wages has destroyed the ROI I referred to earlier. So today we decided to consolidate all of our engineering and research efforts back to our HQ in California.

DomainLobe · #2 (**permalink**) 05-24-2007, 04:24 PM

" my belief that all of the employers rushing to India in the last 3 years has increased wages and provided more opportunity than 20 years of a closed socialist leaning economy ever did. India is a true global powerhouse now. There is no doubt."

Interesting anecdote.
' The World is Flat'
Thanks for sharing.

steve · #3 (**permalink**) 05-25-2007, 12:09 AM

Fascinating isn't it .... for the most talented people at least, this looks the development of a truly global economy when someone who has X,Y and Z skills in Bangalore, Shanghai, London or New York will get paid the same no matter where they live.

Probably this effect will get less and less as you move down the economic ladder. The middle class and people without skills in different countries will continue to earn different salaries simply because they live in one country or another.

DomainWalla · #4 (**permalink**) 12-21-2007, 10:18 AM

This article is more hype than reality. Bengaluru may be crowded and over-heated, but the same is being said about the traffic and HR situation in Silicon Valley.

What this article is most relevant for is small captive (non-commercial) IT development centres, which are not easy to manage remotely or economically regardless of location. The IT and ITeS outsourcing industries in Bengaluru are still highly competitive globally.

Yes, wages are going up and will continue to do so, but studies show that this is mostly for experienced specialists.

It is the falling U.S. dollar and the rising INR that is causing the most concern.

mwzd · #5 (**permalink**) 12-26-2007, 10:18 AM

While salaries are increasing very fast now... I tend NOT to believe the 75% of US salaries bit. An average engg in the US makes about $80,000/yr, here a CEO would make that much. So unless their local management has been skimming a whole lot off the top...I don't see how they managed to reach 75%.

When I entered the workplace (1991) the average salary was Rs.5000 or US$500 (I think the dollar was around Rs.10 then) for a fresh engg. grad.

By 1999 the salaries had gone upto Rs.12,000 or US$500 (dollar went up in relation to Rs.).

Now its a bit crazy at the top of the class but you can still get people for Rs.20,000 or US$500!

At the top end of the ladder things have changed dramatically - salaries of Rs.10,00,000 per year are common place but then so have costs... A house which went for $100,000 six years back is now $300,000.

So i'd hold onto my offshore dev center in India...lol