Design in India

While the cover story of Business Week was taking the optimistic view of our economy because of our strength in intangibles (see previous posting), another story was pointing out the challenges we face. Specifically, the story described how India is racing ahead in auto design - "Detroit Wheels Designed in India?":

Tata Technologies has assembled nearly all the elements it needs to offer U.S. carmakers complete services, from concept to finished design
. . .
Tata Technologies differs from most independent U.S. engineering firms, which tend to be small and specialized. Tata Technologies' workers handle most design for Tata Motors, so they have experience in everything from conceptual design to financial production. "If you map out the entire vehicle design process, we have the capability to supply every piece of it," says [Tata COO Jeffrey] Sage.

Tata is still hiring anywhere from 100 to 150 additional engineers each month. "If you want engineers out of college, the supply is unlimited," Sage says. When Tata Technologies advertised for 200 experienced engineers last year, recruiters interviewed 1,000 qualified applicants in each of the three Indian cities they visited

The story on autos ends with a positive note:

What does this mean for the U.S. engineering work force? Both Sage and [Incat President Warren] Harris [a US company recently acquired by Tata] believe demand will remain strong at home. Even though Indian engineers earn a quarter of what U.S. counterparts with equal skills make, Indian wages are rising 15% to 20% a year, compared with 5% or less in the U.S., Sage says. So it's only a matter of time before the salary gap closes.

And it means U.S. engineers need to be redeployed to higher-value jobs. "The talent here is overpriced for what it's doing," Harris says. "We can play a big role in freeing up those individuals" to spend more time on innovation.

I hate to interject a sour note, but what does he think all those India engineers will be doing next? Does anyone think that they are not capable of "innovation" and those "higher value jobs"?

Try telling that to the Indian National Knowledge Commission. More on that organization next week.