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IT companies announcing salary hikes could boost sentiments for techies who are feeling the effects of the economic downturn due to Covid-19 and the US visa restrictions.
TCS said that it has rolled out salary increases with effect from October1. This was followed by Infosys, which said that it will roll out salary hikes and promotions across all levels effective January 1. Similarly, HCL Tech said that it will hike salaries for select staff from October and for the rest from January. Mindtree Chief Executive Officer and Managing Director Debashis Chatterjee said the company completed its promotion cycle in the second quarter, and salary increments will be effective from January.
Positive impact
Specifically for techies who cannot go back to the US at the moment this is an encouraging sign of being able to be gainfully engaged within India, according to Rituparna Chakraborty, Co-Founder & Executive Vice-President, TeamLease Services.
Agrees Karunjit Kumar Dhir, Co-founder, SCIKEY, a talent solutions provider. “This will definitely have a positive impact on the sentiments among techies, who will now look for jobs in India especially due to the strain involved in H-1B visas,” Dhir said.
This also needs to be seen in the context of companies either cancelling or withholding performance bonuses during Covid-19. However, IT companies have seen an uptick in demand for their services, which has resulted in the salary hikes. The Top-5 IT companies collectively employ more than 1 million or 25 per cent of the total 4 million workforce.
While companies have not yet provided specifics on the salary hikes, industry watchers think they could be high for new-age expertise and lower for legacy or older skills.
New skills
Saran Balasundaram, Founder and CEO of Han Digital, an IT talent consulting firm, said: “We hear from the customers that legacy skills may or may not have attractive salary hikes. However, techies with demonstrated skills like digital, cloud, and analytics could see a 15 per cent salary hike for those in the 3-10-year experience bracket.”
TeamLease’s Chakraborty sees this as a move by companies to keep their top talent motivated and to retain them.
In 2018-19 financial year, the average salary hikes offshore were 6 per cent and on site was in the range of 1–1.5 per cent.
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