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Talented Techies, Lower Costs Give Coimbatore the IT Edge

Published: 18th September 2014 06:06 AM  |   Last Updated: 18th September 2014 06:06 AM   |  A+A-

CHENNAI: Equipped with high literacy, cost-effectiveness and high enrollment, Coimbatore — one of the largest talent pools in the country — is set to become a top emerging player on a national level, according to an industry report.

According to a NASSCOM and Cushman and Wakefield report released on Wednesday, the city is placed high on the list of challengers to established IT hubs like Mumbai, Delhi-NCR, Bangalore and Chennai. Coimbatore’s high position on the list is driven by several factors, including the talent pool in the region. Coimbatore ranked first in the list of challenger cities, which included Kolkata, Jaipur and Ahmedabad, in terms of available talent.

All companies surveyed in the 10 challenger cities stated that the talent pool in their regions were adequate. However, companies in Coimbatore said the available talent pool was much higher than required.

Experts in the industry say that this is the  result of the huge number of engineering colleges in the region — which has grown from 42 in 2008 to more than 60 in 2013 — with over 40,000 qualified professionals entering the job market in 2013 alone.  Consequently, the number of enrollments in the city has sky rocketed.

Coimbatore is ranked first in terms of growth in employee headcount in the last five years, with the number of employees in the IT-BPM industry jumping 30-fold to 15,000 in 2013.

The city is also very attractively placed for companies in terms of cost-effectiveness. According to R Chandrashekar, president of NASSCOM, Coimbatore is the second most cost effective city on the list. “Coimbatore is 20-22 per cent more cost effective than the Tier I city average,” he pointed out. “These are the reasons these cities are emerging as major IT hubs,” he added.

Coimbatore scores in cost effectiveness because of one major factor — real estate. The city has witnessed 12.5 times growth in available Grade A office space in the last five years.

According to the report, the available Grade A office space was 0.2 million square feet (MSF) in 2008. That number though had shot up over 2 MSF by 2013 and is expected to grow at the same rate. Office rents on the other hand, are among the lowest in the country, with Grade A space costing only `34 per sq ft.

The cost of hiring people is also considerably lower in the city, says the report, with people cost as much as 10-15 per cent lower when compared to the Tier I average.

While all these reasons combine to make the city a very attractive destination, the report does point to several issues. Most prominent of these are low connectivity, support infrastructure and a lack of soft skills. But according to B Murthy, a HR consultant, these issues will correct themselves as the talent pool matures.

“The soft skill level of employees in Coimbatore and the surrounding regions have improved at breakneck pace. Coimbatore will only grow faster,” he said.

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