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India holds sway in software engineering

Posted: 09 Jun 2015     Print Version  Bookmark and Share

Keywords:software developer  engineer  OEM  Silicon Valley 

Engineers who get lower salaries compared to their counterparts in other places will most likely search for greener pastures after working for, say, three to seven years in the company.

Lower engineering salaries means managers should brace themselves for the revolving door, especially when three to seven years itch kicks in.

"Engineers are impossible to find," says Frank Kern. He should know, as chief executive of product engineering firm Aricent he employs 11,000 software developers.

To make his case, Kern uses an example from a recent trip to Rensselaer Polytechnic to attend the graduation of his nephew. The young engineer had nine job offers; he accepted one from Tesla.

One of his nephew's fellow grads at RPI was a student from Chennai, India who had 10 offers and took one from Exxon. Both grads will start off making something north of $70,000 a year. That's a far cry from the $6,000-$10,000 starting salaries for engineers working in India, Kern noted.

The cost difference is one big reason why so many companies now have software engineering centres in India, including Aricent which has 75 per cent of its total staff in India in centres in Bangalore, Delhi, Chenai, Hyderabad and Pune. India has long been known for churning out lots of engineering grads who are hard workers and polished English speakers. The problem is hanging on to them.

Aricent loses about 15 per cent of its developers every year. Others in India lose up to 19 per cent, Kern said. Employers dole out big raises, getting young workers up to nearly $20,000 in the first couple years to keep them around.

The tough part comes three to seven years into an engineer's career. Competition is fierce for developers who are trained and have some experience under their belts. That's pushing annual salary increase up into the double-digits again these days, Kern said.

To compete, companies like Aricent are looking for new places to establish engineering centres away from the crowd. They are also reaching deeper into schools to establish relationships with engineers earlier in their schooling.


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