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Comment by GordonS | Hacker News Reader

I've worked as a customer of WITCH companies for many years, and now work for one myself, and have many good friends in India.

Indians are not being exploited - they are being paid market wages, and are part of a huge emerging middle-class in India.

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What you said would've been true in maybe 2002. However, the wages at these companies have been stagnant for the last two decades. They haven't even kept up with inflation. So no, $5k per annum isn't "market wages" for software developers in India. These are the lowest of the low. New grads in India often take these jobs as a last resort if they have absolutely no other option.

This was something that shocked me. These companies are paying the same salary to new graduates as 12 years ago. Inflation in India was high during this period, especially the last few years. I think the reason is customers still want to pay $25-30 per hour. So these companies don't want to pay more. They can't ask more because customers will find some other country. Also, there are too many graduates they can take advantage of.

A teacher in a government school gets paid more than a IT worker these days, and they have guaranteed job till 55. Since IT job is primarily based on low wages, job opportunities become drastically less once they have 10+ years experience (please tell me I am wrong on this).

> customers still want to pay $25-30 per hour

Even $10/hour is lot more than $5k/year for someone working full time. It seems the middlemen are gobbling up a lot of that!

If these students don't have better options, then surely these are market wages by definition, no?

These days, govt employees make more than entry level workers in WITCH companies. That's why many so-called engineering grads also apply for jobs like bank clerk, police constable, etc.

Around 2004, many south Indian governments provided free tuition fees for engineering. So, thousands of engineering colleges were opened just to grab the fees by admitting more students. Now, the new minimum for students is: Bachelor of Technology.

This is India, where 1.3 billion people live. Unemployment is extremely high. So, even 3 lack rupees ~ $4k per annum is better than not having a job. If you want to call it a market wage, that's fine. It is like $15 per hour in the bay area is market wage, just because people have some jobs.

Inflation in India more than doubled in the last 15 years. 15 years, the base salary was $7k per annum. Now the same is paying $4k. (In other words, 300,000 rupees was 2004 salary , even today it is 300,000 for freshers). Basically, WITCH shops want warm bodies for their billable hours.

You're basically encouraging the exploitation of a country's labor force because they happen to have a lot of workers and not many opportunities for them. So yeah, its market wages by definition, but it doesn't make the practice OK.

Just find out how much old age security Indian government provides to people above 60yrs who have not gotten from their employer or have savings. It is less than 5 dollars per month. It is about same amount that an IT guy can spent on a single meal few times per week in India. So by any standard it is not even half decent amount.

When you say this does not make it okay, it seems you simply have no clue the level of disparity most people in India are dealing with. Unless someone magically make every one earn >10K dollars per annum, 5K is lot of money in country where median income is about 600 dollars yearly.

> You're basically encouraging the exploitation of a country's labor force

Who is 'you', exactly? I assume it's some hypothetical 'you' and not me specifically, given that I've only asked a clarifying question.

> So yeah, its market wages by definition, but it doesn't make the practice OK.

No, it doesn't make the practice ok, but it's important to identify the right problem if you want to solve it. "The market affords better opportunities for these workers but they are being forced to work below market" is a different problem with different solutions than "Better opportunities do not exist because the market is very competitive".

In the US, a company I worked for hired TCS to provide developers and QA to our project. Most of them were offshore in India but a few moved to the US because we needed people on site.

I feel really sorry for them. One of the project managers lived in a rented bedroom of another Indian family with his wife and daughter because he couldn't afford a place of his own. Another guy, single, lived in a shared 2BR house with 8 other people for the same reason. And there were more people in the same situation.

This was in NY where housing is not cheap but either way, the way I see it they were being exploited. Probably should blame the company I was working for as well, or perhaps just the VP that pushed to replace Infosys with Tata because he had a history with them and they were cheaper.

Edit: typo

> I feel really sorry for them. One of the project managers lived in a rented bedroom of another Indian family with his wife and daughter because he couldn't afford a place of his own. Another guy, single, lived in a shared 2BR house with 8 other people for the same reason. And there were more people in the same situation.

I see your point and in no way do I advocate for people being treated that way in US. But the viewpoint of many of the workers who accept these arrangements is that its better than what they had back home, or some variation of that argument. I'm not sure how to argue with that.

> Another guy, single, lived in a shared 2BR house with 8 other people for the same reason.

Its not so black and white, if that person is living in the US temporarily then his main motivation is to save a lot of money when in the US and then use that to buy a house back in India.

Some of them make enough money to live alone comfortably but why do that when your main objective is to save so you share with others who have the same mindset.

That guy specifically was transfered and had plans to stay. He actually brought his wife and newborn daughter some time later but was still living in a shared home (not the same with 8 other people, but still).

Well in some cases its because some people initially like to live in a shared home with someone who speaks their language, get more comfortable in the new land and then move out or it could be just be that guy was being paid less and wanted to save money.

In 2014-15, I did a rough calculation of salaries based primarily on Indian government inflation figures. What I found was that 12k USD inflated adjusted was same as 5k USD in 2007.

Today, 5 years later, this figure is surely even more inflated. But if you talk to graduate engineers from these companies they still pay 5k USD. So, I don't know if we can safely say there is no exploitation here.

The counter point obviously here is that there is a large young population joining the workforce each year. So, ensuring everyone gets an IT job as well as paid well is a challenge.

If you are comparing salaries in USD then you should take into account dollar's inflation, not rupee's.

I am comparing salaries paid in India denominated to USD. The cost of living in this case is affected by Indian inflation not US inflation.

  What I found was that 12k USD inflated adjusted was same as 5k USD in 2007

No, $5.000 in 2007 dollars would be $5.060 in 2012 dollars[0]. You are off by over 2 orders of magnitude when speaking in "USD inflated adjusted" terms.

[0] https://data.bls.gov/cgi-bin/cpicalc.pl?cost1=5000&year1=200...

Not true for the past 7 years. A Uber or Ola driver or a construction worker can make Rs.30000 per month which is the same a fresher software engineer makes at WITCH.Bit ofcourse the working conditions and future growth is very bad for a driver or a labour where as a s/w engineer has a huge opportunity provided he works hard.

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