Why Infosys cuts H1-B visas

[OhioChick]

May 25, 2009

Even as the strong anti-outsourcing lobby in the US is forcing US lawmakers to take a relook at their H1-B visa strategy amid huge job losses, Infosys Technologies - which holds the largest number of H1-B visas among all the Indian IT services companies - has started reducing the number as a part of the company's policy to reduce its 'overseas bench' strength.
The number of H1-B visa holders in the company, which was 8,700 as of December 31, 2008, came down to 8,200 as of March 31, 2009, according to information available with Business Standard.

This number is expected to come down further by another 500 at the end of the first quarter of FY10, as the company is further rationalising its workforce in the US by inducting more locals (Americans) in its rolls, a source close to the development said.

However, even as the company is reducing its 'overseas bench', it has simultaneously committed to add another 1,000 American citizens to its rolls in the next 12-18 months, which will take the total number of US citizens on its rolls to 1,800.

However, Infosys member of the Board and Head of HR, T V Mohandas Pai, insisted that the current reduction in the number of H1-B visa holders had nothing to do with the 'reduction in the overseas bench'.

"The number of people (H1-B visa holders) go up and down based on business requirements. When the business is down due to the recession, we don't need so many people (in the US)," he said.

He said the company had been hiring in the US for the past three years and it's part of the company's strategic plan to hire more locally.

"It has nothing to do with Obama's announcement and the US government's proposals to lower the H1-B visa limit," he added.

According to the latest update from the US Citizenship and Immigration Services, as against an available upper cap of 65,000 as mandated by the US Congress, only about 45,000 H1-B visa applications were received till May 19 this year.

Other than the global recession, experts say the fact that each H1-B visa costs about $3,000-5,000 per applicant is reason enough for companies not to invest so much on obtaining such visas.

Of late, most India companies have increased their uptake of local talent in the US. Wipro has already announced its intention to hire over 750 US workers for its newly opened centre in Atlanta.

IT major TCS is also focussing on more US citizens in its workforce, according the company's COO N Chandrasekharan.

"It's important to create critical mass and have a local delivery capability to service onsite clients. If we do this from India, it will be quite costly," he said.

http://business.rediff.com/report/2009/may/25/bcrisis-why-infosys-cuts-h1b-visas.htm