India’s booming smaller cities

What is the issue?

The InfoTech industries heading a charge to tier-2 and tier-3 cities have been speeded up by the pandemic.

India’s second-level cities are finally coming of age.
The pandemic has both accelerated and slowed the move to tier-2 and tier-3 cities.
Fresh Graduates looking for career in big metropolitan cities are rethinking to stay in Tier 2 and Tier 3 cities and build a career there.
The youngsters who work from home (WFH), especially those who don’t have customer-facing jobs are reluctant to return to Big City with higher rents and hour-long commutes.

Industries also re-evaluate their deepest beliefs on how companies should function.
Remote operating model’s success, without a productivity dip, has proved employees no longer need to be in metro cities to execute projects.
The big-city exodus is mainly led by the IT/ITeS sectors followed by engineering-services firms and Start Ups
This is due to high rents and rising costs of hiring talented youngsters in the bigger cities.
Others are also training their eyes in the same direction.
The level of disruption in smaller cities is much lower when compared to metro cities.
Staffers are returning to offices at a brisker pace in tier-2 and tier-3 centres than in metro units.
Given these advantages, companies are likely to aggressively open new centres in tier-2 and tier-3 cities like Kochi, Coimbatore, Ahmedabad, Indore, Jaipur, Lucknow, Bhubaneswar, Chandigarh, Kakinada, Vijayawada and Warangal.

The biggest driver is the Internet and mobile phones. It brings the world to even to a remote village.
Eating out and entertainment options are virtually the same as in bigger cities.
Many franchise stores have expanded their operations across smaller Indian cities.
Several restaurants have also turned their attention to these cities as they recover faster from the pandemic than metro cities.
The entertainment options like malls and cinema halls are also the same.
State governments also are aware of the need to provide uninterrupted power and telecom facilities.
Several of these cities have engineering colleges where tech and engineering services companies can hire from.

Youngsters don’t want to be stuck in one company. They worry about opportunities available because there aren’t too many companies in a tier-2 city.
India’s corporate world has always revolved around a handful of cities.
However this is about to change dramatically as a flood of companies head to smaller-city India.
Infotech companies moving to smaller cities suddenly found their office-building plans put on hold due to pandemic curbs.
IT/ITeS sectors occupy 40% of the commercial real-estate sector
They offer a huge chunk of jobs. So any move they make is bound to have an enormous impact.

Reference