One of my Indian/American friends here, who has a sister working in one of the Indian outsourcing companies, has passed on this tidbit.
They have between 25% and 40% staff turnover (churn). The cause appears to be job hopping for more money. This has been forcing pay increases in an effort to retain staff. And apparently it’s endemic for all the outsourcers.
Read this as you may, but this can only increase outsourcing costs, making it less cost effective for U.S. firms.
This goes hat in hand with another part of of the rumor, there appears to be, on the surface, a lack of available tech staff available to hire. Seems like they have found the bottom of the barrel, staff wise, hence the staff churn.