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Worst still to come for IT, ITeS and realty staff
By siliconindia
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Wednesday, 17 December 2008, 16:05 IST |
9 Comments
New Delhi: Tough time is still to come for IT and ITeS employees as the worsening financial crunch may lead to further salary cuts in near future. Employees who took huge loans for flat and vehicle are finding it hard to repay the money as companies don't even provide the offered hike and sometimes they cut the current salary, reported The Economic Times.
"Employees in real estate, financial services, information technology (IT) and related services (ITeS) should prepare themselves for salary cuts of up to 15 percent. The first quarter of 2009 will see major cut in compensation levels and lower pay hikes," said recruiting firm Headhunters India Chief Executive Kris Lakshmikanth. A recent ILO reports on wages indicates that the wages will grow by at best 1.1 percent globally in 2009 compared to 1.7 percent in 2008
The crisis would mostly affect the employees at lower and middle levels."The top management will be least affected, while the temporary staff, contractual workers, trainees and interns will have to bear the brunt," said Proffessor J S Sodhi, Director, think-tank Shri Ram Centre for Industrial Relations & Human Resources.
Global HR consultancy Hewitt Associates predicts salaries would rise by a subdued 8-10 percent compared with last year's average hike of 15-20 percent. Target variable pay, bonus and merit increases may well be halved. "Only 40 percent of the top performers would get salary hikes and increments in real estate, finance, IT, ITeS and manufacturing companies next year. The bottom 20 percent will suffer," opined Dr Ganesh Shermon, People and Change Advisory Practice Head, KPMG.
India's largest IT exporter TCS plans to raise salaries by just half compared to last year."The company had offered 15-20 percent salary increase in 2008-09. But we plan to bring it down to 10 percent in India due to the macro-economic factors, as well as business-specific factors, at the end of the current fiscal," said TCS Human Resources Head Ajoy Mukherjee. "Given the market conditions, wages hikes will be even lower in FY10," he added.
The other big Indian IT companies such as Infosys and Wipro have already announced plans for single-digit salary increases in FY09. Things look equally grim for executives in real estate companies. "We have already made 10 percent salary cuts across levels. It has gone up to 30 percent for top management," said Delhi-based builder Omaxe Chairman Rohtash Goel.