The IT sector has witnessed stunted salary hikes for freshers in the past 10 years compared to their CEOs, a Business Today analysis shows. The salaries of freshers have increased a little over 45 percent while the salaries of CEOs have zoomed around 1,500 per cent.
An analysis of the average salary packages of IT company CEOs and freshers, sourced from earnings report data and publicly available information, shows that freshers’ salaries have gone up only 46.94 per cent in the past 10 years while the salary of CEOs has shot up a whopping 1,492.27 per cent.
Read More: How to check your PAN Card history to avoid fraudulent misuse
Moreover, the median salary of CEOs is up 1,449.02 per cent while the median salary for freshers is only up 40 per cent, the Business Today analysis highlighted.
This discrepancy in the salaries between the CEOs and those at the bottom of the pyramid is not lost on industry veterans. T.V. Mohandas Pai, former CFO and Board Member at Infosys, told Business Today, “There has been no increase in compensation for freshers. They are being paid the same `3.5-4 lakh that the companies were paying 10-12 years ago. During this time, the salary for managers and seniors has gone up 4x, 5x, 7x.”
Vineet Nayar, former CEO of HCL Tech echoed similar views. He told Business Today, “This is an unfortunate depreciation and understanding of the roles that employees play in an organization’s growth. We have not understood the fundamentals of management. The fundamentals of management is that if companies were to spend even part of their marketing budget on enthusing, encouraging, and enabling your employees, you would see 10x returns.”
Read More: UIDAI urges Aadhaar holders to update documents submitted 10 years ago
As per data from a TeamLease Digital report, the specific ratio of pay between the CEO and a fresher working in the same company highlights how disproportionate the salaries are at both levels. At Infosys, this ratio is 1,973; at Wipro, it is 2,111; at HCL Technologies it is 1,020; at Tech Mahindra it is 644, and at TCS it is 619.
Kiran Karnik, former president of NASSCOM noted that this disparity could be because the current graduates and freshers do not have the correct skills the industry is looking for.
Karnik told Business Today, “I now speak across the board in aggregate terms, they(freshers) don’t have the skills that the company needs. Very often they don’t have the domain skills, they have to be trained in that. And most often they don’t have what we call soft skills, working in teams, communicating in any language.”
