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A bit busy today.  Too many headlines to catch up on.

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Inflation vs Wages

Average wage = 48L per annum.

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A week ago, Joshua Hager was despondent. Laid off by a mortgage company, he has looked for jobs ranging from bank teller to risk analyst. He was sending out as many as 10 resumes a day but was getting barely a nibble from employers or recruiters.

Hager has joined nearly 125,000 others on Wall Street and at mortgage firms and other financial companies who received pink slips since the start of 2007. It seems that nearly every week another financial firm lets go of thousands of workers at all levels. With the market flooded, it’s hard for the unemployed to land a job, experts said.

Every time he turns on the television, Hager worries that he’ll hear of more layoffs. He shuddered when he learned that JPMorgan Chase would acquire Bear Stearns, which employs 14,000 staffers.

“How many people will be swamping the job market?” he said. “Everybody in finance will be looking for a job.”

My Take : Rightnow the problem is with the Finance jobs. If the economy continues to detoriate, we might soon see other sectors also getting affected. If that continues for a prolonged period, other countries also could affected.

I wanted to break the long hiatus from blogging. What better day than to do it than the Independence Day of my mother land. 

When I was about to return from UK, I called a friend from there and informed him of my impending departure from the “Empire”.  I sounded very excited to meet up with friends and family. He quipped back … “You sound so excited about your return to your mother country “.   Frankly, this “mother country” theme NEVER turned me on.  Its just my family and friends. 

I am still wondering why we celebrate this Independence Day. It sounds so hollow here.   If you had lived in a western country you would know the difference.  Mediocrity and resistance to change has become the norm of this country. It’s so silly to hold the parade on republic and independence days and shows of the military toys. We have been doing the same thing over for 60 years. The toys are not great anyway. The speech is listened by none. Whatever speech the leaders give is not going to be followed by them. This is what I call resistance to change and mediocrity.

 I would touch upon economics, a subject dear to my heart. Economically, India is in a better shape than before. No doubt. In terms of preparedness for the future, we are a long way off. One small shock, we are at great risk. You might have noticed the big clamour that ensued the dollars descent from 43 to 40. This is a harbinger of the times ahead.

Enough said. This could be the icing on the cake of Independence Day celebrations. 

You can turn to me and ask “This is a nice rant but how are you helping the cause ?”. I say “Forget the cause; I am trying to make you understand so that you save your ass”.

From Business Week

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India’s talent shortages started appearing last year in technology and outsourcing, and attrition rates in those businesses today top 25% annually. Pay for qualified managers in tech has shot up as much as 30%, and now everyone, including big foreign companies, is scrambling. Even Genpact, India’s largest outsourcing shop and 40% owned by GE, has had to be innovative. It has set up a half-dozen storefronts in six cities to recruit workers for entry-level outsourcing jobs. The skill shortage “is the biggest challenge for our industry,” says Pramod Bhasin, chief executive of Genpact. So far, Genpact has hired 650 new staffers from the centers, but its turnover is still 30% a year.

As India’s domestic economy expands, the shortfalls are spreading beyond tech. Wages for semi-skilled workers in the textile factories of Coimbatore, for example, are up 10% this year, while supervisors’ salaries have risen by 20%. Pay in the banking industry is up 25% in the past year and has more than doubled in hot areas such as private equity. Airline pilots have seen wages rise 25%. Overall, Indian salaries will rise by 12.8%, compared with inflation of 5.5%, according to human resources consultancy Mercer, which warns that continued increases could hurt India’s economic revival.

While many industries are having trouble finding the right workers, they have so far muddled through by hiring less-skilled employees and training them. Private firms are starting to offer courses for everyone from flight attendants to engineers. More private colleges are springing up, and some 450,000 new students are enrolled in engineering schools this year, up from just 250,000 last year. “India has a huge educated workforce,” says Dominic Price, JPMorgan Chase & Co.’s (JPM ) chief in India. “As it gets equipped with new specialized skills, it will temper the current level of wage inflation.”

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My view is this : Yes, we have talent shortage now. Supply (of skilled labour) is not meeting the demand. Its a supply side problem now.

However, the DEMAND WILL EASE. US economy is slowing down and capital spending will go down which will lead to demand for workers to go down too, atlease in IT services.

I would ask my
grandmother, “why does Ganesh ride
a rat?” For in most of the pictures in our
prayer room, the deity is shown on this
unusual mount. At the simplest level the
sight of an elephantine god on a tiny mouse
visually equates the importance of the
greatest and smallest of God’s creatures.

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