Entry-level salaries in IT industry remain flat since 2010; CXO compensation jumps up to 90%

​​Fresh hires constitute approximately 30 per cent of the total 5 million Indian IT industry workforce and mid-level salaries have jumped up to 45 per cent during the past decade.
Representational image.

Representational image.

New Delhi: Entry-level salaries in Indian information technology (IT) industry have increased only “marginally” since 2010 even as the pay packages of CXO-level executives have climbed up to 90 per cent in the same period.
Freshers’ average annual compensation was nearly stagnant at about $5,000 for more than a decade till early 2020 before tech companies rolled out multiple salary hikes that pushed the remuneration package beyond the $5,000-level, ET reported, citing data from staffing company Xpheno.
Fresh hires constitute approximately 30 per cent of the total 5 million Indian IT industry workforce.
Citing data from staffing company TeamLease Digital, the financial daily mentioned that the average compensation of an entry-level employee in IT services companies is about Rs 3. 6 lakh per year, as against around Rs 9 lakh a year for a fresher in IT product companies.
Facing a talent shortage over the last two years due to the coronavirus pandemic, India’s $227-billion IT industry has seen decade-high growth rates for the sector overall, and this pushed attrition rates up to 30 per cent at some of large IT companies as employees switched jobs quickly, lured by huge salary hikes.
Industry insiders are of the view that moonlighting—the practice of working on other jobs while already in employment—has been mainly driven by techies earning less salary spending 4-8 years in the industry.
Mohandas Pai, former chief financial officer and board member at Infosys, told the publication: “You have to pay people a living wage. Fresher salaries have (barely) jumped from Rs 3.5 lakh-Rs 3.8 lakh a decade ago. Even inflation is not accounted for here. IT companies should pay them at least in real terms.”
He went on to add that board compensations have steadily risen over the decade even as employees have been underpaid.
The data demonstrated that mid-level salaries have grown by an average 40-45 per cent during the last decade overall, while C-suite salaries have jumped by “leaps and bounds”.
Currently, HCL Tech’s chief executive C Vijayakumar is the highest paid CEO among top IT companies, with a salary package of Rs 130 crore for the 2021-22 (FY22) fiscal year.
Tata Consultancy Services (TCS) CEO Rajesh Gopinathan took home Rs 25.77 crore in FY22, an increase of 27 per cent, while Infosys chief executive Salil Parekh’s compensation stood at Rs 71 crore, up 43 per cent in the same period.
The daily cited Anil Ethanur, co-founder of Xpheno, as saying that the salary hikes at the top level are not comparable to the rest of the organisation.
He added: “The sheer scale and value of business that CEOs of Indian tech bellwethers operate sets them apart…(Indian) enterprises deem it important to keep compensation of their CEOs comparable, if not competitive, with global CXO benchmarks. Entry-level packages have, at best, risen by Rs 90,000 in Annual CTC (cost to company) terms over this period.”
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