Bangalore: The corporate world being the one of the worse hit spheres of economic slowdown, most of the industries now resort to a tightened HR process reveals Hewitt Associates study. Sharpening of the skills should range in the priorities for the employees, as the companies shall opt for higher salary offers to a few skilled ones. Salary freeze do not occur in their list but lower salary increase do figure, with 'performance linked pay' also being preferred.

Amongst 150 leading IT firms, around 57 percent prefer increasing productivity and 31 percent in redeployment of manpower, for a stabilized inflation pressure and a lowered HR budgets. While only a meager 20 percent opted for a complete freeze in the hiring. Moreover, to put a check on compromising on employee salaries or learning and development, they have begun with the cutting costs on spheres like travel and recreation. As per the study, 25 percent of the companies surveyed are looking to reduce staff budgets, with cuts largely in the areas of travel and recreation; only nine percent of the companies mentioned a reduction in training budgets. While one percent are looking at increasing work hours to manage rising costs of business, four percent of the organizations mentioned a promotion freeze.

30 percent of the companies surveyed said they have increased performance linkage to counter fixed pay increases, which is led by Pharma (50 percent), FMCG (43 percent) and BFSI (40 percent). The slowdown in the job market has put a halt in the irrational salary offers to attract more people and it will be limited to some selected skilled groups.

In terms of the rate of salary increase in 2008, Infrastructure sector leads with a 24.1 percent increase while IT and ITES witnessed it to be 12.6 percent and 12.5 percent respectively. According to Sandeep Chaudhary, leader of Hewitt's Rewards Consulting Practice in India, "Contrary to expectations, there hasn't been any dramatic move to downbeat macro-economic factors on compensation. Organizations need to set new performance agenda and reassess if their compensation strategy is driving organizational and employee performance. Companies should focus on grooming internal talent and build from within to manage their future talent needs." The companies, around 42 percent, as measures for the compensation management, were of the opinion to lower salary increases while 28 percent opted for lesser hiring and another 28 percent has no plans for any change. Thus, the freezing of the salary never occurred in their list of changes.