November 9, 2006 6:50 AM PST

Nasscom keeps ringing worker shortage warning bell

India could face a severe shortage of highly skilled IT workers by 2010, according to the president of Indian IT trade organization Nasscom.

Kiran Karnik repeated warnings aired in the past few years that the Indian IT industry could face a shortfall of around half-a-million workers in four years, severely limiting growth targets.

Nasscom Vice President Sunil Mehta explained what the implications of this would be. "A possible skills shortage will directly impact the business being handled by India and gradually affect the size and nature of contracts being outsourced to India, (as well as) industry revenues," he said.

Nasscom has been aware of the problem for some time. According to last year's McKinsey report, commissioned by the group, India will need an additional 1 million people to join the IT and BPO (business process outsourcing) work force by 2010 (bringing the total work force to 2.3 million) in order to maintain its current market share.

Mehta said the organization is trying to combat the problem in three ways: expanding the pipeline of people willing to join the industry; improving the quality of the potential and current work force; and better matching jobs to people so that attrition is reduced.

"We are hopeful that with all this under way, we will be able to solve the potential shortfall for the industry," Mehta said.

Tim Ferguson of Silicon.com reported from London.

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