When Appharu Pvt. Ltd., an IT consultancy and services company, used to publish a vacancy announcement two and a half years ago, the firm used to receive more than 50 applications. However, the situation has become quite different now as the company is receiving much fewer applications for job openings compared to the pre-pandemic period. According to Turup Sangroula, Chairperson of Appharu, it is becoming harder to find the right person to fulfill the human resources needs of the company which manages websites and applications of more than 50 media companies in Nepal. “The problem with the Nepali IT sector is that there are a limited number of qualified human resources in the market,” Sangroula shares. “This is happening as qualified manpower always prefer jobs abroad.”
According to entrepreneurs and HR managers, the dearth of human resources in IT has aggravated after the Covid-19 pandemic. After developed countries eased their travel restrictions with the subsiding of the pandemic, graduates who had planned for a long time to go abroad studies, began to fly to different countries in large numbers leaving the Nepali IT sector high and dry for qualified workforce. Similarly, in the wake of the digitization accelerated due to the pandemic, western countries are aggressively working in the field of IT. This has led to the huge outflux of IT professionals from the country to find opportunities abroad.
According to Subhash Sharma, director at F1Soft, the Nepali IT sector has always faced a shortage of skilled human resources. “And after the Covid-19 pandemic, the problem has even worsened,” he said, adding, “After the Covid-19 situation eased, students traveled to countries such as the United States and Australia in huge numbers resulting in a severe crisis of skilled manpower in Nepal.” The scarcity of IT workforce in the country is also because the academic calendar was obstructed for two years due to the pandemic. “In the last two years, students didn’t graduate, and the availability of human resources was very limited,” said Sharma.
Nepal produces around 15,000-16,000 IT graduates every year. Of them, more than 6,000 go overseas for further opportunities, say IT stakeholders. Besides, there is also a trend that those who stay in Nepal either work for foreign companies through outsourcing firms or work in domestic companies for a certain period before starting the process of applying abroad.
The pandemic has caused serious constraints in the supply of qualified IT workforce in advanced economies forcing the countries to attract IT graduates from emerging and developing nations. Australia, for instance, has been struggling with a shortage of IT talents due to the shift to working and learning at home following the Covid-19 pandemic. As per an estimate by the Australian Tech Council, the shortage of workforce is expected to grow to 260,000 workers by the end of 2025. The country is working to cover the gap by bringing IT professionals from different countries, including Nepal.
According to Mukunda Pokharel, founder of Rigo Technologies Pvt. Ltd., the shortage of quality IT human resources has been felt globally. “After the United States, Australia, and the United Kingdom realized the need for quality human resources during the pandemic, they started to bring young and brilliant minds from developing nations giving new opportunities,” said Pokharel.
“Not only that, but foreign companies are also searching for brilliant minds in countries like Nepal through outsourcing companies. They pay almost triple or more than what Nepali companies have been offering,” said Pokharel, adding that Nepali graduates are earning three times more than what they have been getting through outsourcing companies.
“The problem with outsourcing companies is that they are not registered in Nepal, and do not contribute anything to the economy. The outsourcing companies are bringing money to Nepal through illegal money transfer channels like Hundi. The government needs to bring all the outsourcing companies under the purview of law and formal banking and remit channel because the nation is losing a huge amount of money in taxes. And as long as people get paid, they don’t care where and how the money is coming from,” he said.
According to Pokharel, besides the outflux of IT graduates and experienced workers, the trend of establishing new companies has also led established IT firms to face the scarcity of human resources. “Many professionals who used to work in reputed companies have started to establish their own companies after the pandemic. They are particularly opening outsourcing firms,” he added.
As it has been extremely difficult to get quality human resources through vacancy calls, companies have started to headhunt skilled professionals. “In recent times, companies have started headhunting individuals. They have raised the salaries of new recruits by 10-20 percent,” said Pokharel, adding that retaining staff, in this difficult situation, has been a tough job for companies.
Although the government has been talking about creating a digital economy, stakeholders say there have been no efforts from the authorities concerned in this regard. To create a digital ecosystem, the government needs to identify the areas to work on. But neither the government has any idea of how many IT graduates are needed for Nepal, nor does it works on increasing the capacity of educational institutes, say stakeholders.
While the number of IT graduates seems good at the moment, entrepreneurs say that colleges are focusing less on the quality side. Talking to the HRM, an owner of a tech company said, “Nepal has failed to produce a good number of IT professionals due to the negligence of colleges. The courses, as colleges claim, are at par with international universities. But just theoretical classes doesn’t help to produce quality graduates.”
According to Sangroula, Nepal has enough resources but lacks quality human resources. “In Nepal, 90 percent of IT graduates are unqualified or semi-qualified. We have to train graduates before hiring them,” he said. “In our company, we need a lot of programmers. And what I have experienced is that a college has only been able to produce five-six good programmers in one academic session.”
To tackle this situation, Appharu has been sending graduates to institutes for training. “We only hire graduates after they train in institutes for a few months. And we provide on-the-job training to those who are semi-qualified,” said Sangroula, adding that the company has had pending works for two years. “If we get enough human resources, we can complete the work in one year, and start working on new projects.” After the Covid-19 pandemic, around 7-8 employees working at Appharu went to Australia for further studies and some have already started the process to go abroad. “It has been a challenging time for companies like ours,” mentioned Sangroula.
Now the major focus should be on upgrading colleges and institutions by introducing digital technologies so that they can produce industry-ready resources. For that, new technologies should be introduced, visiting professors should be invited for lectures, say stakeholders. Likewise, they also suggest that one-year internship programs should be included in the curriculum so that students learn from both college and working space.