Technology giant IBM operates in more than 170 nations, but the Armonk, New York-headquartered company has its largest workforce in India, according to a report. IBM employs more people in India than it does in its home nation, the report said.
Even as IBM disagreed with US President Donald Trump’s claims that it was moving jobs from the United States to India and other countries, that’s what the company has been effectively doing over the years, The New York Times reports.
Compared to about 100,000 people who work for IBM in its US offices, the company’s India workforce is about 130,000. With that many employees, India alone accounts for one-third of the company’s headcount.
These employees work on all of IBM’s businesses, including research in visual search as well as artificial intelligence for self-driving cars, the report said. The company has a “garage” full of app designers that make IBM apps for iPhone and iPad, the report added.
Several US technology companies including Apple, Facebook, Google, and Amazon operate in India and have sizeable business in the country. Several of these companies employ Indians using H1-B temporary visas in the United States, something that has irked the Trump administration. Citing data from recruitment analytics firm Glassdoor, the New York Times estimates that IBM has shrunk its US workforce from 130,000 in 2007 to 100,000 that it has now.
Offshoring some of the jobs helps a company reduce the operation costs. Employees in India are paid a fraction of their US counterparts, for instance. The report claims that an India-based employee makes between half to one-fifth of what they might have made had they worked in the United States. It needs to be pointed out that companies often take into consideration the local conditions and cost of living into consideration before determining how much an employee should be compensated.
For IBM, offshoring is even more critical. “The work in India has been vital to keeping down costs at IBM, which has posted 21 consecutive quarters of revenue declines as it has struggled to refashion its main business of supplying tech services to corporations and governments,” The New York Times report states.
IBM opened its first offices in Mumbai and Delhi in 1951. In 1978, after a dispute with the Indian government about foreign ownership rules, the company left the nation. But it re-entered again in 1993 through a joint venture with Tata.