These IT Companies Gave Double-Digit Salary Hikes In 2022! Which IT Firms Gave Maximum Salary Hike?
As per a report by brokerage and research firm Elara Capital, companies like Coforge, L&T Infotech (LTI) and Persistent Systems (PSYS) hiked salaries in double-digits in FY22. Reportedly, this is the maximum hike that they have given in 4 years.
In FY22, the median wage rise was 2.4x five-year average wage increase for midcap Indian IT companies as acute supply-side strain necessitated roll-out of substantial salary hikes.
Double Digit Hike in Companies
Looking at the hike by Coforge, it was at 27.2% year-on-year (YoY). The salary hike for L&T Infotech, Persistent Systems, Mphasis and Mindtree were 18.3%, 14.5%, 9% ad 7% respectively.
As per the research by Elara Securities, the FY17-22 salary CAGR has LTI/Coforge at the top and Mindtree and Mphasis at the bottom.
With Mindtree (MTCL) leading the pack, the employee pyramid restructuring was evident for all such companies in FY22. As per the pyramid restructuring model, large number of employees have less experience. This is used as a strategy to cut costs as the total wage bill reduces.
As compared to the previous four years, the employee growth has exceeded the median salary growth which implies faster fresher addition (pyramid flattening).
As demand for services such as cloud-computing, digital payment infrastructure, cybersecurity and cryptocurrency transactions surged, employers paid top compensation to lure skilled workers.
Companies Positioning Themselves for Engineering and R&D Talent
The note which emerged from the comparative analysis of tier-II IT companies’ annual reports said that the companies like L&T Infotech, Mindtree, Mphasis (MPHL), Coforge and Persistent Systems have a few common theme-threads. As per the note “IT companies are favorably positioning themselves on engineering capability/R&D service, as such service lines may emerge as key growth drivers in the next few years – Information Services Group’s (ISG) Q2CY22 ER&D grew 41% and most plays saw double-digit YoY growth in median employee compensation in FY22. Further, offshoring spiked sharply and travel expense, as a percentage of revenue, has spiked for most plays, but is still far below pre-Covid level”.