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According to the report, the engineering, manufacturing, process, and infrastructure sectors reported an average increase of 0.8 per cent while the FMCG sector witnessed an average salary increment of 5.4 per cent
The report pointed out that between 2019 and 2023, salary increments in companies related to six major sectors of the country averaged only 0.8 per cent. (Representative/Shutterstock)
Private sector employees face numerous challenges, including constant job insecurity due to the threat of layoffs. Maintaining employment often necessitates consistent high performance. Furthermore, even when employees navigate these difficulties, salary increases remain meagre, with companies prioritising profit maximisation.
This concerning situation was highlighted in a report by the industry chamber FICCI, prompting government intervention.
A recent survey conducted by FICCI and Qvesh Corporation Limited reveals a concerning trend. Despite companies enjoying substantial profit growth over the past four years, employee salaries have seen only marginal increases. The report indicates that corporate profits have quadrupled during this period, while employee remuneration has risen at a significantly lower rate.
Chief Economic Advisor V Anant Nageswaran has acknowledged the seriousness of this disparity and urged the corporate sector to take appropriate action.
The remuneration growth rate figures released last month have fallen to 5.4 per cent, the reason cited being that corporate sector income is below 10 per cent. This comes at a time when company profits have increased fourfold in four years.
Following this, FICCI and Quesh Corp Limited conducted a survey of companies. Their findings revealed that between 2019 and 2023, salary increments in companies related to six major sectors of the country averaged only 0.8 per cent.
The report reveals an average increase of 0.8 per cent in the engineering, manufacturing, process, and infrastructure sectors. In contrast, the FMCG sector experienced an average salary increment of 5.4 per cent.
However, when adjusted for inflation, these increases become negligible, even negative. Over the past five years, retail inflation has fluctuated between 4.8 per cent and 6.7 per cent, significantly outpacing salary growth.
Government sources cite low incomes, particularly exacerbated in urban areas post-pandemic, as a significant contributing factor to the consumption decline.
This concern is underscored by the Chief Economic Advisor, who, while presenting a report on the matter to corporate audiences, urged Indian companies to take swift action. The report highlights the disparity between salary growth and inflation: a mere 2.8% average increase in the banking and financial sector, compared to 3.7% in retail, 4% in IT, and 4.2% in logistics.
