India’s tech talent pool is from Vizag, Indore and Warangal — that’s where Infosys, TCS and others are heading

• The expenses of living have increased across the country due to inflation, white-collar jobs and people are looking for ways to go back to their hometowns.
• According to a report by Nasscom and Boston Consulting Group, 65% of the employees in India want to shift to tier 2 or tier 3 cities.
• Top tech majors like Infosys, Wipro and TCS have opened offices in Tier-2 and Tier-3 locations like Guwahati, Bhubaneswar and Jamshedpur.

After a long hiatus, software engineer Jatin Sharma moved back to Gurugram from his hometown Jaipur. His company has called him back to the office - and he has to be present at least twice a week.

Since it’s too far for him to make the trip from home, he shifted back to the city and has been living there for the last six months.

“I’ve realized that my monthly expenses have increased at least by 20-30% in the last six months. It was comparatively lesser before Covid. I am unable to save anything like earlier,” Sharma told Business Insider India.

The expenses of living have grown across the country in the last four months due to food and fuel inflation. Moreso, urban areas are tighter on the pocket, making him look for ways and means to go back home.

“If I had the option I would want to move back to my hometown. My expenses over there are quite low,” Sharma further added. He is not the only one who thinks so.

Surat vs Mumbai, Kochi vs Chennai

According to a report by Nasscom and Boston Consulting Group, 65% of the employees in India want to shift to tier-2 or tier-3 cities.

The cost of living in Surat is 50% lower than Mumbai, while in Jaipur it is 35% lower than the national capital city. Similarly, the cost of living in Kochi is 30% lower than the cost of living in Chennai, says the report titled Shaping the Future of Work in India's Tech Industry.

Urban migration of white collar workers is very prevalent in India as a significant portion of employees are from tier-2 or tier-3 cities.

Since most of them moved back to their hometowns during the pandemic and enjoyed the comfort of their homes and near and dear, they’re reluctant to come back to hefty rents, lonely life and also miss the pleasures of living at home.

The reverse migration of tech cos

As the saying goes, – if Mohammed doesn’t come to the mountain, the mountain will come to Mohammed. To cater to this trend, top tech majors like Infosys, Wipro and TCS have opened offices in tier-2 and tier-3 locations like Guwahati, Bhubaneswar and Jamshedpur.

In the last 18 months, this expansion has intensified.

“A large number of our people are working from hometowns. We have looked at it and (want to) ensure that they have opportunities to work closer home. These are not satellite offices. It is at least 1,000 seaters and we will expand them as we go forward. In the next quarter-end, all these offices will be ready,” Krishnamurthy Shankar, group head of human resource development of Infosys told ET.

Infosys is setting up new offices in Coimbatore and Vizag, to access the talent pool.

Opening offices in tier-2 or tier-3 cities is also beneficial for organizations too. These companies which have been struggling with increased salary hikes, can receive access to a wide talent pool at salaries that are at least 20-30% lower.

As of now, about 976 MNCs have set up 1,257 Global In-house Centres (GICs) in India. Of this, only 68 GICs are in tier-2 locations, by Zinnov, a management consultancy. There are more towns which can be tapped, across the length and breadth of this vast country.

“Indore, Chandigarh, Warangal, Kochi are some of the tier-2 cities of high potential for the company and it expects to narrow down to two to three cities for launching new offices,” as per Nasscom report.

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