The Joe Biden administration will be more favourably disposed to immigration and free flow of talent across borders as it is expected to bring about ‘meaningful administration’ changes on the visa front while a concerted effort in this area could start to show changes within 18 months, but will likely take 2-3 years to fully work through, said Peter Bendor-Samuel, Chief Executive Officer, Everest Group, a Dallas-based management consulting and IT analyst firm.
“There are three critical components to the immigration riddle: the law, the rules and the administration of the rules. The new Biden administration will likely face a divided Congress and if this proves to be the case, it will unlikely attempt to change the laws,” Mr. Bendor-Samuel told The Hindu.
“Having said that, it is much more favourably disposed to immigration and a free flow of talent across borders, and so it will likely move to address the rules and the administration,” he said.
As America races in the new digital world, it would continue to depend on Indian deep talent, however, more of that talent will find a home in the U.S. itself. Realising this, the Indian tech service firms, who have grown large and became profitable on labour arbitrage, should evolve and adapt fast to the new reality, he cautioned.
Commenting on the margin pressure emanating from localisation, he said, “If the Biden administration does relax the gauntlet of getting talent approved for visas, this may enable more STEM (science, technology, engineering and mathematics) workers in the U.S., but will not impact the underlying secular trend to have more work done in close proximities. Hence, we may find a growing proportion of work done within the country, thus the pressure on tech industry margins will continue.”
According to him, most clients want work to be done onshore, the reasons for this are diverse, but centred around improved productivity and closer alignment of IT and engineering with the business stakeholders. The new innovations in Devops and other related operating models favour teams that are in the country or at least in similar time zones. The distributed model of the large India-based talent factories is still useful for some work, but as more work shifts to these new models there is pressure to increase the proportion of work done within the country.
Responding to a query on the shortage of STEM talent, the soaring unemployment and half-a-million existing vacancies in computer occupation in the U.S., Mr. Bendor-Samuel said it would take a substantial restructuring of the higher education system for the U.S. to be able to meet its STEM needs. “This seems unlikely now so we can expect the U.S. to be operating in a STEM deficit for the foreseeable future. Given that the localisation efforts are highly likely to continue and clients are increasingly expressing their preference for a diverse talent mix, we do not expect the IT industry to be able to achieve increased margins from importing more labour,” he clarified.
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November 10, 2020 at 11:47PM
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Biden administration favourably disposed to immigration, free flow of talent across borders: Everest Group - The Hindu
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