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5 Compelling Reasons to Hire Employees in India

Access to talent
CXC Global5 min read
CXC GlobalApril 19, 2024
CXC Global

In a recent survey, more than 75% of employers globally said they struggled to find the skilled talent they need in 2023. This represents a year-on-year increase of two percentage points, and more than double the difficulty reported in 2015. In fact, if this survey is to be believed, the global talent shortage has reached a 17-year high. 

In this context, it’s no surprise that many organisations are looking to meet their talent needs by hiring across borders. In this article, we’ll talk about one emerging talent pool that’s getting a lot of attention in 2024: India. 

With a large (and growing) working-age population, strong English proficiency and an increasing supply of tech skills, India should not be overlooked as a source of talent. Read on for more reasons to hire employees in India. 

5 benefits of hiring talent in India

Large talent pool

One of the biggest advantages of hiring in India? There’s a lot of talent to choose from. India is home to more than one-sixth of the world’s population, and around 68% of its people are of working age. That workforce is also growing fast: according to a recent report, it increased by 99.2 million between 2000 and 2019.

Another interesting factor: India’s workforce is very young, with people under 25 accounting for more than 40% of the country’s 1.41 billion-strong population. To put that another way, one in five people aged 25 or under in the entire world live in India.

But there’s a catch: despite a huge number of people joining the workforce every year, there simply aren’t enough opportunities in India for all of them. In fact, although India’s overall unemployment rate is decreasing, it’s still above 15% for graduates and around 42% for graduates under 25 years old

Translation? Thousands of young, skilled Indian graduates are struggling to find work — and willing to look outside of the country to get it.

Strong English proficiency

Fact: when you hire workers overseas, you need to be sure that you’ll be able to communicate with them. For European companies, that usually means ensuring the people you hire have a high enough proficiency in English to work with your team. 

Thankfully, English is widely spoken in India. Although exact figures are hard to come by, some estimates suggest that around 10% of India’s population (or about 140 million people) speak English to some degree. English is one of the official languages used by the Indian government, alongside Hindi. Language education company Education First ranks India as ‘moderately proficient’ in English. Those aged 26–30 score the highest, closely followed by those in the 21–25 and 31–40 age brackets. Proficiency also varies significantly by region, so it’s worth looking around to find the best English-speaking Indian talent.

Availability of tech skills

According to data from consulting firm Ernst & Young, India has become one of the world’s biggest exporters of IT and business process outsourcing (BPO) services, which brought in 157 billion USD in 2021–22.

At the same time, corporations around the world have opened over 1500 ‘global capability centres’ (GCCs) in India as of September 2022. Together, these GCCs employ over 5 million people, and somewhere between 50% and 70% of the world’s technology and operations headcount are based in Indian GCCs.

Put simply, India is becoming a hub for tech talent. This has been made possible by a strong education infrastructure that produces large numbers of skilled tech graduates. According to one report, India produces over 30% of the world’s STEM graduates.

Various government initiatives, including the launch of the Ministry of Skill Development and Entrepreneurship, have made this possible. Founded in 2014, the ministry works with several educational institutions to determine skill gaps, design and deliver training and certify skills. 

Opportunity for cost-saving

The cost of living in India is significantly lower than in much of Europe and North America — and average salaries are much lower too. That means that there’s a significant opportunity for cost savings for companies that choose to hire employees in India.

Of course, this isn’t about taking advantage of Indian talent. But with such a large gap between European budgets and local expectations, it’s possible to offer a locally competitive salary that still represents a big saving on your end. In other words, everyone’s happy. 

Potential for cultural fit

When you’re hiring talent in a different country, it’s important to consider the cultural differences between your local team and your overseas employees. After all, the country we’re born and raised in can have a big impact on the way we relate to work. 

Of course, it would be impossible to fully explain an entire country’s approach to work in a couple of sentences — especially one as large and diverse as India. But given the country’s long-standing role as a key outsourcing destination, many Indians are familiar with the expectations of Western employers.

Plus, we shouldn’t forget that India has 22 official languages listed in its constitution — and many more unofficial ones. That means that Indian employees are likely to be accustomed to speaking to people who don’t share their mother tongue. 

Of course, it’s always important to consider cultural norms and expectations when hiring workers from a country other than your own. For example, according to some sources, Indians tend to put more of an emphasis on hierarchies within the workplace, and value building relationships with colleagues. 

With its vast talent pool and emerging status as a global tech hub, India could be the answer to Europe’s talent shortage. But, as with any other country, hiring in India as a foreign company presents certain administrative and legal challenges. 

For one thing, hiring employees in India usually means setting up a legal entity there — which can be expensive and time-consuming. There’s also a risk of permanent establishment, which could land you with a big tax bill. 

Plus, like all countries, India has its own set of laws, customs and common practices when it comes to employment. And if you’re not familiar with them, you might struggle to engage and retain local talent.

The solution: Hire employees in India through an Employer of Record (EoR)

Don’t panic! There is a way to hire employees in India without a legal entity, and without putting your business at risk: using an Employer of Record (EoR)

An Employer of Record (such as CXC) is a company that hires workers on your behalf and handles administrative functions like payroll, benefits administration and contracts so you don’t have to. You’ll still be in charge of the day-to-day management of your Indian employees — but in the eyes of the law (and the tax authorities) they’ll be employed by the EoR. 

That means you can get straight to hiring the skilled talent you need, instead of wasting time and money setting up a legal entity. And you can do it without worrying about potential damage to your business. 

Easily hire employees  in India with CXC

Our Employer of Record solution allows you to seamlessly hire and manage talent in India (or anywhere) without adding to your team’s administrative load or putting your business at risk. 

Put simply, our solution allows you to hire the right people to move your business forward — wherever they are. Want to learn more? Speak to our team today to get started.

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About CXC

At CXC, we want to help you grow your business with flexible, contingent talent. But we also understand that managing a contingent workforce can be complicated, costly and time-consuming. Through our MSP solution, we can help you to fulfil all of your contingent hiring needs, including temp employees, independent contractors and SOW workers. And if your needs change? No problem. Our flexible solution is designed to scale up and down to match our clients’ requirements.

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