Cut to 2010. Mr Snow no longer feels like the odd man out, as Indian IT firms in the US aggressively move in to recruit local talent, partly to suit their growth plans, and partly to assuage concerns triggered by rising joblessness in the US.

In the past 12-18 months, around 15,000 US professionals have joined Indian firms across function, from entry-level customer care to senior level sales and consulting positions. And like Mr Snow, most of them had never worked with an Indian company before.

IT veterans that ET spoke to say this trend would gather strength in the coming months, as Indian players strive to address concerns over flight of jobs, besides strengthening their own onsite services delivery capability.

Indian IT’s umbrella body, Nasscom, sees US protectionism as a key issue that could slow down growth of the $50-billion technology outsourcing business, spurring Indian companies to hire more local talent. The US market accounts for 61% of the business for Indian services providers.

Today, locals comprise about 30% of the Indian IT employee base of over 100,000 in the US. This is up from just a few hundreds 4-5 years ago, when most onsite needs were met by flying out engineers from India on H1B visas and the local talent was sought only for a few consulting type jobs.

“It’s also a sign of evolution and maturity of the industry. More Indian companies will be creating onsite jobs and hiring local talent as the industry expands,” says Pramod Bhasin, chairman of Nasscom & CEO of Genpact, India’s largest business services provider.

The onsite jobs include client interfacing functions like consulting, sales, solutions requirements and solutions deployment while the manpower intensive testing, coding and maintenance work gets done from remote locations, mainly out of India. Infosys has over 11,000 employees in the US and Wipro has 7,000, about a third of who are local Americans.

Wipro also opened a new office in Atlanta this fiscal. “We intend to localise more and almost all the 1,000 positions in the Atlanta office will be staffed by local hiring,” says Saurab Govil, senior vice-president, HR, Wipro Technologies. Last year, TCS hired at least 300 associates in the US and in its new facility at the Cincinnati suburb of Milford which can accommodate 1,000 associates.

Genpact has 1,500 people in the US, 90% local Americans, in cities like Wellsburg, California and Danville in Illinois. Of its 27,000 employees, Firstsource has 4,000 staff in the US (all Americans) and the $200-million Mumbai-based services player Mastek’s top management team is mostly American, based out of the US. Last year, it hired 350 local services delivery professionals as well.

“As the industry has grown bigger, there’s lot more need for long-term staff. This need is being met by local hiring. At the same time,
short-term assignments are done by a combination of locals and flying out staff from India,” says TV Mohandas Pai, member of board and director, HR, Infosys Technologies.

The present spurt in hiring locals is due to a combination of the “economic slump and more easily available talent”, says Ameet Nivsarkar, VP, Nasscom. In fact, most Indian companies hire local talent in what are Tier II cities in the US like Arkansas, St Antonio, Tampa, Kansas City, Alabama, and Buffalo.

Talent here is 15-20% cheaper than in big cities, understands the requirements, needs no training to start and service providers creating local jobs are more favourably looked at when pitching for business.

“For a lot of government and healthcare projects awarded in the past six months, customers prefer a US presence. Hence, the number of locals has gone up,” says Rishi Das, CEO, CareerNet Consulting, a Bangalore-based search firm.

According to Firstsource’s MD & CEO Ananda Mukerji, for certain processes like healthcare, records can’t go out of the country and banks may prefer their platinum and gold customers to be served onshore. “As Indian providers now offer a complete gamut of technology to business services, many processes are getting done locally,” he says.

Firstsource has centres in Kansas, Colorado, Kentucky and Miami from where it does credit card, third-party debt collection and healthcare processes. “In the past 6-9 months, we have seen that clients are more keen if you have a large onsite presence as well,” he says.

Mr Pai of Infosys believes that as companies become bigger and capture the more critical pieces of the customers’ business, about 25% of the work will be done onsite, which will be met by local hiring rather than sending people on H1B visas. In fact, in 2008, TCS, Infosys and Wipro, three of the largest Indian technology services companies, together had over 10,000 H1B visas. In 2009, the figure was less than 2,000.

Sid Pai, managing partner, TPI, a global sourcing advisory firm, sums the trend up saying that one would have to live with the idea of lower margins eventually. “As the industry expands, it will have to learn to deliver operations in consuming countries as well and live with lower margins, it’s part of the growth story,” he says.