Bangalore losing its IT charm

cThe Times of India

Bangalore: Slowly but surely, the IT capital of India is losing some of its charm for business. At least some surveys say so. In a recent study conducted by TeamLease, a major staffing company, the business outlook for Bangalore is seen to be weaker than for cities like Pune, Hyderabad and Kolkata.

The latest TeamLease Gallup Employment Outlook Survey puts Bangalore’s business outlook index at 73% (that is, this proportion of companies surveyed are optimistic about business conditions in the city). This compares with 78% for Mumbai, 74% for Chennai, 77% for Hyderabad and 78% for Pune. While Delhi has dropped to 71% (84% in October 2004), Kolkata has improved to 69% (39% in October 2004).

“Though many companies are flourishing in Bangalore, there is a slight change in perception. All the talk around the city’s poor infrastructure is beginning to play on the minds of decision makers,” says Nirupama V.G., associate director, TeamLease Services.

This survey is conducted every six months and this time nearly 400 companies were part it. Its key objective is to anticipate the pulse (present) and mood ( f u t u re ) of companies around their labour market decisions.

Further, 75% of the companies in Bangalore have indicated an increase in their respective businesses during the coming months. In Pune, Hyderabad, Mumbai and Delhi, this figure is higher at to 79%, 82%, 80% and 76%, respectively.
“Companies in Hyderabad and Pune are really upbeat about the manner in which their requirements are being met. In fact, Kolkata has changed dramatically. They are becoming very business-friendly,” adds Nirupama.

The employment outlook ranged from a low of 36% for Chennai to a high of 89% in the case of Hyderabad. This means that the preference to opt for Chennai and expand there is much lower than for Hyderabad. Bangalore stands somewhere in the middle with 69%.

Despite certain shortfalls in some cities, the survey clearly states that the overall scenario for future business continues to look very positive and similar to the levels of six months back.

Kelly Services, another company that provides staffing services and solutions, also endorses the fact that the overall business outlook is highly positive. In its 2005 India Recruitment Index, the company has found that about 80% of the companies interviewed predict that recruitment will be driven by at least one expansion or improvement initiative in the remaining months of 2005.

Kelly’s survey spoke to key human resource decision makers in India’s largest 1,500 organisations, by employee size.

Says Dhirendra Shantilal, VP and MD for Kelly Services in Asia, “Our survey reflects the buoyancy of the Indian employment market. While supply is abundant, the distinct trend is for employers to hire quality talent.”