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Source : http://economictimes.indiatimes.com
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last activity : 07 06 2010 20:18:04 +0000
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What we predicted earlier this year is now coming true. Salary increments in IT companies are lower this year than it has been in previous years. In some cases, significantly so.
EDS is giving an average increment of only 8% to 10% this year, substantially lower than the 18-20 % it gave last year.
“In some cases last year, it even went up to 40-50 %,” said an employee of the company. That’s the increment trend across the tech sector. “We have received lower increments this year,” said an employee of Infosys Technologies. “Laterals got only some 8% hike. A company security policy e-mail has also asked us not to share such details with anyone outside.’’
Mohandas Pai, head of education & training in Infosys, said that inclusive of variable pay, the company’s increments this year were in the range of 11% to 13%, against 13-15 % last year. Senior HR executives at some large tech firms confided that their companies are not in a position to increase salaries "beyond single digits" at least for a couple of years, till the global markets stabilize. "Companies are hit from all corners. Market downturn, increase in hiring cost and billing pressures are choking even large players. This has forced them to drastically revise their increment formula," says Mohan Lal Menon, managing director, Sentient Consulting, a corporate consulting firm.
The biggest pressure is seen to be coming from theUS US
"Companies preferred it as they wanted to keep employees across the board (except the bottom 10%) happy, to keep attrition at bay. But in today’s scenario, cost pressures are compelling them to change that approach," said the HR director of a tier 1 tech firm. "Indian companies have so far been effecting unsustainable salary increments. It has clearly hit a correction mode this year," says B S Murthy, CEO of hiring firm Human Capital. Wipro’s average salary increments are expected to be in the range of 8% to 10% against 12-14 % last year. "Pay hikes expected to happen in August will be some percentage lower than the previous year’s," says Anindya Shee, head of compensation & benefits in Wipro.
Product firms that give out huge hikes are also on a costcutting binge. "Recession is hitting them hard and increments are down to 10-15% from 20-25% in previous years," observes Ajay Dutt, VP, New Era India Consulting. And if lower increments make employees unhappy, there’s little they can do about it. In previous years, they would have jumped into another job at a signficantly higher salary. Now, with IT companies no longer hiring as they were, nor offering any such hikes, they have to be content with what they get.
EDS is giving an average increment of only 8% to 10% this year, substantially lower than the 18-20 % it gave last year.
“In some cases last year, it even went up to 40-50 %,” said an employee of the company. That’s the increment trend across the tech sector. “We have received lower increments this year,” said an employee of Infosys Technologies. “Laterals got only some 8% hike. A company security policy e-mail has also asked us not to share such details with anyone outside.’’
Mohandas Pai, head of education & training in Infosys, said that inclusive of variable pay, the company’s increments this year were in the range of 11% to 13%, against 13-15 % last year. Senior HR executives at some large tech firms confided that their companies are not in a position to increase salaries "beyond single digits" at least for a couple of years, till the global markets stabilize. "Companies are hit from all corners. Market downturn, increase in hiring cost and billing pressures are choking even large players. This has forced them to drastically revise their increment formula," says Mohan Lal Menon, managing director, Sentient Consulting, a corporate consulting firm.
The biggest pressure is seen to be coming from the
"Companies preferred it as they wanted to keep employees across the board (except the bottom 10%) happy, to keep attrition at bay. But in today’s scenario, cost pressures are compelling them to change that approach," said the HR director of a tier 1 tech firm. "Indian companies have so far been effecting unsustainable salary increments. It has clearly hit a correction mode this year," says B S Murthy, CEO of hiring firm Human Capital. Wipro’s average salary increments are expected to be in the range of 8% to 10% against 12-14 % last year. "Pay hikes expected to happen in August will be some percentage lower than the previous year’s," says Anindya Shee, head of compensation & benefits in Wipro.
Product firms that give out huge hikes are also on a costcutting binge. "Recession is hitting them hard and increments are down to 10-15% from 20-25% in previous years," observes Ajay Dutt, VP, New Era India Consulting. And if lower increments make employees unhappy, there’s little they can do about it. In previous years, they would have jumped into another job at a signficantly higher salary. Now, with IT companies no longer hiring as they were, nor offering any such hikes, they have to be content with what they get.
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