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Tata cuts US visa applications for software engineers by nearly 70%

New hires outside India fall to 11,500 but still raise cost concerns

MUMBAI -- Tata Consultancy Services (TCS), India's largest software exporter, has reduced applications for the H-1B visas needed by Indian engineers to work in the U.S. by almost 70% compared to two years ago due to immigration and other concerns hanging over its largest market.

"In 2016 and again this year, we have applied for only a third of the visaswe had applied for in 2015," said Ajoy Mukherjee, TCS's head of global human resources.

"This has allowed us to bring down our dependence on work visas significantly," said Chief Executive Rajesh Gopinathan in the company's latest annual report.

For the financial year ending in March, the company hired over 11,500, employees abroad, including graduates from leading engineering campuses and business schools in the U.S., but this was lower than the 16,173 hired the previous year.

Mukherjee said the company has historically recruited local talent in all major markets, and has significantly increased the practice in recent years, partnering with academic institutions and engaging with high school students. "We are hiring from over a hundred engineering campuses in the U.S. and also hiring MBAs from top B-schools, and the experience has been excellent," he said.

Mukherjee believes TCS was the top foreign recruiter in the U.S. in its last financial year. Overall, it had nearly 79,000 employees overseas -- over 12% down year on year -- in a total workforce of over 387,000 employees spread across 55 countries.

Mukherjee said one reason for the recruitment fall was that reduced attrition had left "fewer positions to backfill".

"That aside, in the longer term, newer technologies and our adoption of automation and non-linear models will keep driving greater productivity," he said. "That means we will require fewer people to generate the same unit of revenue."

TCS and other information technology companies like Wipro, Infosys, and HCL Technologies, have been facing criticism in the U.S. -- especially since President Donald Trump took office -- for allegedly taking away local jobs. A rising wave of protectionist is also being perceived in countries like Australia and Singapore.

Last month, Infosys announced it would hire 10,000 American workers over the next two years and establish four technology and innovation hubs in the U.S., focusing on artificial intelligence, machine learning, and emerging digital technologies.

Wipro says it is making significant investments in the U.S. where Americans accounted for more than half its work force in April.

Employing more Americans as a necessity in the more politically charged climate will likely increase costs for India's $150 billion IT services industry, which depends on the U.S. for about 60% of its business.

In India, these companies are seeing major workforce churns. Press reports suggest thousands of people have lost jobs as the IT sector goes through a transformational period.

A senior executive at Infosys, the country's second largest exporter of information technology, told reporters last month that only 400 people have been laid off, and that some 20,000 will be hired this year. Unions want the situation clarified and have called for government intervention.

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