A TOI report highlighted that in recent years, the frequency and timing of salary hikes have become inconsistent across industries, leaving employees unsure when to expect salary adjustments.
Competent CEO Ravi Kumar, after taking office last year, initiated a further pay hike in April, just six months after the previous one in October 2022. This move was aimed at addressing high salaries. dropout rates. However, CFO Jatin Dalal recently stated during the September earnings call that with attrition under control and better utilization, the company has moved away from multiple hikes and opted for a regular hike in August this year.
HCLTech, another major player, announced in August that no firm decision had been made on pay increases this year, after previously deferring increases for some employees. wipro Historically, increases have been staggered between April and September. Ray Wang, CEO of Constellation Research, highlighted the current uncertainty, saying: “CFOs of service companies sometimes lack firm guidance on future quarters and a full recovery has not been signaled.” He noted that while some green shoots are seen, discretionary spending remains low, resulting in postponed appraisals as a cost-saving strategy.
He labor market in India remains tight, and Global Capability Centers (GCCs) are attracting talent despite these delays, Wang added. However, in the United States, the labor market has relaxed, giving employers more influence.
Motilal Oswal Financial Services According to TOI, companies that defer salary increases until the second half of the financial year will see better margins in the September quarter. Companies like HCLTech, which have delayed annual increases, are expected to face pressure on their margins later this year. Traditionally, IT services companies rolled out raises and promotions at the start of the financial year, but the slow demand environment has caused delays over the past two years. Sunil C, India country director at HR solutions firm Adecco, observed that IT companies tend to prioritize short-term project outcomes over long-term growth, especially for employees with high-end niche skills. demand. “Approximately 8% to 12% of employees with specific skills receive off-cycle raises, while 30% to 40% of employees experience no salary adjustments,” he said, emphasizing current trends affecting promotions and salary increases.
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