NEW YORK – IBM, the tech company that dominated the United States in the early years of the digital age, before Google and Microsoft, has about 130,000 employees in India which is about one-third of its total work force, and more than in any other country.
According to the New York Times, IBM’S work in India spans an entire gamut of businesses, from managing the computing needs of global giants like AT&T and Shell to performing cutting-edge research in fields like visual search, artificial intelligence and computer vision for self-driving cars and one team is even working with the producers of Sesame Street to teach vocabulary to kindergartners in Atlanta.
“IBM India, in the truest sense, is a microcosm of the IBM company,” Vanitha Narayanan, chairman of the company’s Indian operations, told the New York Times in an interview at IBM’s main campus in Bangalore.
The work in India has been vital to keep down the costs at IBM, which has posted 21 consecutive quarters of revenue declines as it has struggled to modernize its main business of supplying tech services to corporations and governments.
The company’s employment in India has nearly doubled since 2007, while its work force in the United States has shrunk through waves of layoffs and buyouts as outsiders estimate that it employs well under 100,000 people at its American offices, a 30,000 decrease since 2007.
According to data posted by the research firm Glassdoor, it is much cheaper to employ Indian workers as depending on the job; the salaries are one-half to one-fifth than those paid to Americans.
Ronil Hira, an associate professor of public policy at Howard University who studies globalization and immigration, told the New York Times that the range of work done by IBM in India shows that off shoring jeopardize even the best-paying tech jobs in America.
Based in Armonk, NY, IBM’s chief executive, Ginni Rometty, who helped carry out the India expansion strategy, pledged to create 25,000 new American jobs after Trump won the election.
The company also said that it will be investing in the United States by bringing $1 billion to create training programs and opening new offices.
Narayanan, who spent 12 years working at IBM in the United States and China before moving to India in 2009, said the company decided where to put jobs based on where it could find enough qualified workers and the customer’s budget. “It’s not as if someone says, ‘Oh, jeez, let me just take these jobs from here and put them there,’” she said.
William Lazonick, a professor of economics at the University of Massachusetts in Lowell, who has studied the globalization of business, said that IBM and other tech companies have benefited greatly from the emergence of a low-cost, technically skilled English-speaking work force in India.
“IBM didn’t create this, but IBM would be a totally different company if it wasn’t for India,” he said.
IBM even has a Bangalore “garage” full of app designers who build corporate iPhone and iPad apps to simplify tasks like helping airline agents rebook passengers, bankers make loans and doctors update patient files.
IBM, which opened its first Indian offices in Mumbai and Delhi in 1951, however, it left in 1978 after a federal dispute about foreign ownership rule and made a comeback through a joint venture with Tata in 1993; today the company is spread all across the country, including Bangalore, Pune, Kolkata, Hyderabad, and Chennai
In 2004, IBM landed a landmark 10-year, $750 million contract from Bharti Airtel, one of India’s biggest phone companies, which remains a major customer.