The employees, who were waiting for the economy to bounce back before jumping boats, are happy and brimming with joy again. Most of the global HR firms have predicted that staffers will see a salary hike of about eight to 16 per cent in the year 2011.
The one definitive change in compensation philosophy reinforced is the performance and reward linkage, with top performers receiving twice as much salary increase as compared to average performers. Speaking about the upswing in the coming year, Anand Bhatia, HR head, south of a leading healthcare group, says, “Individual performance, coupled with company performance will be the most commonly used criterion for determining performance bonus in the New Year. Across levels, variable pay component of compensation packages is likely to go up to about 15 per cent.”
And it’s the IT and telecom companies which will dole out the best remunerations. Double-digit wage inflation is set to make a comeback next year for the first time since 2005-2007 say IT heads unanimously. “It’s a dogfight, and it’s no more about fresher hiring anymore. We want employable engineers, ideally with one to three years’ experience. Double-digit salary hike is set to become the norm next year,” says the CEO of one of the top ten Indian tech firms.
Santosh Malidar, the vice president of an executive hiring firm says, “We expect the good times to continue. Coming out of 2009’s recession when these tech firms trimmed their payroll and tightened perks to cope with the crisis, the top three software exporters alone plan to add nearly 100,000 new staff in 2011, much higher than the 20,000 they added last year. So, it will be boom time.”
Employees are happier, but also dreading the busy days of cutthroat competition ahead. Karthikeyan M., a programmer analyst believes that it’s a winner’s economy. “It’s a great reassurance that after two years of slump we are finally going to get our hikes and bonuses on time. But it’s going to get tougher as one will have to earn it, as the companies want fierce performance as a result of market correction.”
Firms are also beginning to look beyond just salary hikes. “Increase in pay will continue to remain strong and innovative incentives like holidays with families, etc, will come back in a big way. We believe the top four or five IT companies will be more vulnerable because their employees are in greater demand,” says Kishore Sachdev, head of a popular staffing services firm.