A decade or two ago, the term “Bangalored” was a pejorative. It implied the transfer of a high-value job from tech citadels such as San Francisco to outsourcing hubs like Bengaluru, primarily to take advantage of the labour pricing arbitrage advantage that India enjoyed.

Earlier this week, Bhavish Aggarwal, the founder and CEO of Bengaluru-based mobility startup Ola put out a tweet that proposed, only half-jokingly, that he was considering moving his tech hiring from Bengaluru to a lower-cost alternative like… wait for it… San Francisco. “Engineering hiring situation in Bengaluru—thinking of offshoring some work to a lower cost center in SF, Bay Area!,” he tweeted.

“Getting Bangalored” had come full circle.

It is probably still a pejorative, albeit at the other end of the spectrum.

Aggarwal’s tweet was not an isolated sentiment. If you talk to any startup founder in India, they will all tell you the same thing—tech talent is at a crazy premium. The lament is common across the pyramid, from unicorns such as Ola and large startups like BharatPe, CRED, and Pine Labs to seed-funded and bootstrapped startups. Hiring tech talent is the new gold rush, an unprecedented battle for engineers to join and stay in companies.

Companies are also getting desperate, offering crazy high dollar-denominated salaries and handing out BMW superbikes and Mercedes-Benz cars to lure and retain talent. Once disparaged as nameless-faceless “cyber-coolies”, the lives of software engineers in India seems to have come full circle—they’re now counted as rock star celebrities.

One school of thought surmises that this is because of an acute shortage shortage The Nutgraf - The Ken The 10,000 engineer rule Read more of high-quality engineering talent in India. And while there may be some truth to that, the real question is, “Why just now”? If there is indeed a shortage of talent now, why and how were things different, say, two years ago or five years ago. Shouldn’t salaries have been similarly high then?

It is, therefore, clear that this imbalance is not so much due to a sudden inadequate supply of talent as much as it is due to a precipitous increase in demand. The Ken spoke to a number of startup founders and venture capital (VC) investors to piece together the reasons for this increase in demand. They broadly fall under three categories of “booms”.

The Covid boom

The first proximate trigger is the Covid-19 pandemic—in two different ways.

Last year was a wait-and-watch year for most of the world. Alarmed by canary calls in the pandemic coal mine from prominent VCs, a lot of companies completely froze hiring. They even laid off folks, cutting down on expenses to wait out the crisis. This year, as the unpredictable fallout from the pandemic has seemingly run its course and the world has come to terms with the new normal, companies are back on their feet and are hiring with a vengeance.

AUTHOR

Sumanth Raghavendra

Sumanth is a serial entrepreneur with more than eighteen years experience in running startups. He is currently the founder of Deck App Technologies, a Bangalore-based startup attempting to re-imagine productivity software for the Post-PC era. Sumanth’s columns appear regularly in leading publications. He holds MBA degrees from the Indian Institute of Management, Bangalore and Thunderbird, The American Graduate School of International Management, USA.

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