Infosys pays $1m to six employees

BANGALORE: Million-dollar pay cheques no longer raise eyebrows in the Indian IT industry. Given the huge demand for high-quality professionals, some top-notch companies are willing to pay the big bucks. Six employees of Infosys Technologies posted overseas earn $1 million annually, perhaps making the company the highest paymaster in the Indian IT industry. According to sources, these six employees are neither part of the founding team and nor are they board members. In fact, they are business heads of the company’s different verticals. The list does not end here. There are around five professionals who earn a package of $800,000 and about 25 professionals in the $500,000 bracket. In the case of Infosys, the differentiating factor is that they (employees) are professionals and are no way linked to the founder members.

Original Story

IT/BPO wages not likely to come down: Infy official

Wage hikes in both information technology and the BPO sector are not likely to see any moderation from next year but would continue to grow at the current rate of 12-15 per cent annually, a senior Infosys Technologies official said.

"We feel that it will still remain at 12-15 per cent. The reason is nothing has changed so far," Infosys' head (HRD & Education & Research) T V Mohandas Pai told PTI in Bangalore.

Arguing that wage inflation would remain at the same levels, he said the Indian economy continues to grow at nine per cent which means that many people have more options than before.

"External environment for IT remains the same. We have not seen the impact of subprime (mortgage crisis in the US). Nothing has changed", Pai said.

He also brushed aside suggestions that talent supply is improving. "In two years, you can't turn the tap on and say more people will come to the market. We feel that the wage increase will remain at 12-15 per cent for next year".

NASSCOM Chairman Lakshmi Narayanan and Tata Consultancy Services Chief Operating Officer N Chandrasekaran said last week, they expect wage hikes in the IT and BPO industries to moderate beginning next year.

Cognizant Technology Solutions Vice-Chairman Lakshmi Narayanan had said manpower supply was improving, thanks to various initiatives taken on talent and workforce development by NASSCOM, companies themselves and various engineering colleges.

Original Story

Indian software salaries rise 19%

A typical Indian software professional got an average salary increase of 18.7% in 2007, an improvement over 18.3% increase recorded in the previous year.

 

This is revealed by a nation-wide survey carried out by IDC India for CyberMedia group’s flagship publication Dataquest, covering 2,806 IT professionals.

 

The results, to be published in the forthcoming issue of Dataquest magazine, reveal that foreign multi national corporations (MNCs) pay higher salaries. And among MNCs, those engaged in R&D pay the highest. Not surprisingly, the Top 3 paymasters in the industry--Cadence, Sun Microsystems, Honeywell Technologies--were all engaged in R&D. Seven out of the Top 10 in the list included MNCs like IBM, Capgemini and CSC.

 

The industry average salary grew by 11% in 2007 to touch Rs. 6.2 lakh per annum. This growth is encouraging compared to a drop of 3% in the industry average salary in 2006. This average salary increase is considered significant considering that the software talent pool of the top 50 companies has grown sharply-- at nearly 30-40% annually, in the last three years. It is generally expected that with the on-campus recruitment of thousands of freshers, the average salaries should go down.

 

Though Dataquest’s base of 31 companies surveyed comprised IT services players, R&D centres of software vendors, MNCs, hardware players and even systems integrators and resellers, no big disparities in salary levels were noticed.

 

While Cadence and Sun are the top paymasters for all employees with up to 10 years of experience, industry bellwether Infosys is more generous with the salaries of its senior and experienced employees. Infosys is one of the best paymasters for professionals between 10-15 years and more than 15 years of experience.

 

Going by the salary levels, the study says that for fresh engineers it makes sense to embark on a career in a Software R&D firms. For the more experienced professionals, it adds that, the salary levels at Infosys match with the best.

 

Contd on page 2....

The survey points out that there is virtually no correlation between ‘salary levels’ and ‘satisfaction with salary’. While TCS employees rank their company at No. 4 in terms of ‘satisfaction with salary’ it is ranked at No. 13 in terms of salary. Infosys is ranked at No 12 in terms of salary but is ranked No. 28 in terms of ‘satisfaction with salary’.

 

Commenting on the survey results, Dataquest Chief Editor Prasanto Kumar Roy says, “We knew that high salary didn’t always mean high satisfaction, but the sheer extent of disconnect is amazing. There was less than 8% correlation between salary and satisfaction with salary!”

 

Mr. Roy adds, “What it means is that companies who have their act together on employee satisfaction can manage a lower wage bill—and still have satisfied employees. For instance, HCL Infosystems was way down at #23 in salary rank, but it topped the charts on employee satisfaction with salary!”

 

The report points out that the Indian tech companies must find a way out of this ever increasing wage rise as rupee appreciation squeezes their margins even further. The not-so-simple answer is, of course, to improve employee satisfaction. But some companies are also trying out a six-day week, selectively, to offset the impact of rupee appreciation on their margins by increasing billable hours.

 

Many more companies, including some of the MNC captives, may also do away with a five-day week that is a strong part of their culture, to bring in competitiveness on the HR front.

 

Young Workforce

Professionals with less than 5 years work experience today form 70% of the 1.6 million strong Indian software work force. Just 1 out of 5 professionals has between 5 to 10 years of experience and less than 1 in 10 professionals has over 10 years of experience.

 

Forty per cent of the professionals polled for this survey had obtained their qualifying degree from the South Indian states of Tamil Nadu, Andhra Pradesh, Karnataka, Kerala and Pondicherry. Those with qualifications from western Indian states of Maharashtra, Gujarat and Goa made up about 20% cent of the professionals. Educational institutes from India’s capital, New Delhi contribute 6.5% of the professionals.

 

Engineering graduates, post graduates and masters in computer applications constitute about 70%, and MBAs make up for about 6%. Post graduates and graduates in humanities, commerce and sciences and those with diploma and certificate programs in computers make for the remaining 24%.

 

Even though the average age of the professionals has increased marginally to 28.1 years (from 27.5 years), lack of experience poses challenges at the middle management level, the Dataquest-IDC study adds. 

 

The average age has been derived based on data from over a dozen companies that participated in the magazine’s Best Employer Survey for three consecutive years. These include TCS, Infosys, Wipro, Tech Mahindra,Patni, CSC, Aricent, Hexaware, Zensar, HCL Infosystems, GlobalLogic, RMSI and Cadence.

Original Story

Exodus: Top four IT players lose 10K employees in Q1

New Delhi: Indian IT companies, grappling with an appreciating rupee eating into their profits, are also finding it hard to retain employees with the top-four firms - TCS, Infosys, Wipro and Satyam - witnessing an exodus of about 10,000 people in the first quarter.

Although, all the four firms collectively hired more than 25,000 employees in the April-June period, the net addition was just about 16,300 - taking their total headcount to 2,85,357 employees.

Except for Satyam Computers, attrition rate went higher at Infosys, Tata Consultancy Service and Wipro from both the previous quarter as well as the year-ago period.

All the four companies reported an adverse impact of rupee rise on their profitability and margins, and are looking at various hedging measures, which include improving employee utilisation rates.

However, analysts believe the high attrition rates, mostly triggered by employees seeking higher salaries, could adversely impact the companies' plans to improve utilisation rates.

TCS, the biggest in terms of revenue as well as headcount, saw an exodus of about 2,500 employees, while just over 2,000 people quit the country's second largest software exporter, Infosys.

The employee loss is estimated to be much higher at about 3,500 at Wipro, the country's third-biggest IT firm, while Satyam, the smallest of the four, saw the lowest number -- about 1,600 people -- leaving.

Interestingly, April-June quarter is the period when most of the software firms implement annual wage hikes and see a sharp surge in new hirings.

TCS, Infosys, Wipro and Satyam had net additions of 5,512, 3,730, 4,319 and 2,716 employees respectively in the quarter.
TCS reported an attrition rate of 11.5 per cent, up from 10.6 per cent a year ago and 11.3 per cent in the previous quarter, while it stood at 13.7 per cent for Infosys, unchanged from the previous quarter but higher than 11.9 per cent in the April-June period last year.

Satyam saw its attrition rate falling to 14.9 per cent from 15.7 per cent in the January-March period this year and 19.2 per cent in the year-ago period, where as Wipro witnessed a sharp surge to 20 per cent from 17 per cent in the previous quarter and 15 per cent in the year-ago quarter.

Wipro says its high attrition rate was driven by various factors such as seasonality and a spike in the number of employees
going for higher studies during the quarter, as well as the company's practise of implementing annual wage hikes in the third quarter.

The annual hikes are fully reflected in first quarter results of Infosys and TCS, while some of the other front line IT firms do the same either in the second quarter or spread it over a number of quarters.

"This year, in particular, we have seen a spike in the percentage of people who have gone for higher studies, which is not very uncommon to see in quarter one, because all admissions open up around this time," Wipro Corporate Vice President (Human Resource) Pratik Kumar told analysts in a conference call to discuss the company's quarterly results.

However, Wipro is anticipating a decline in attrition going forward as the company has decided to advance annual wage hikes to August, while it does not expect people leaving for higher education to be a factor.

"We have been effecting our offshore salary increases in the beginning of third quarter, unlike some of the industry peers who do it at the start of the financial year. This used to expose us and, to an extent, we used to be vulnerable on that count," Kumar added.

Infosys' Director Human Resources Mohandas Pai said exodus has somewhat stabilised at the company in the past one year, after taking into consideration the 1.5 per cent involuntary attrition at the fresher level.

Pai said this accounted for people who joined at the fresher level but did not complete the training after failing the qualifying test.

"Second quarter of last year we had 2,040 people leave us, third quarter 2,040 and the fourth quarter it came down to 1,640 because of seasonalities. And this quarter it is 2,010," Pai said at a conference call on July 11 after announcing the company's first quarter results.

Wipro also recorded 1.4 per cent of forced attrition rate in the quarter. In the year-ago quarter, almost 2 percentage points of attrition was due to voluntary separation.

The company said this was partly due to a clean-up exercise on the issue of fake resumes, while some people left after being put in lower quartile performance on completion of annual appraisal cycles in the previous quarter.

No cap on private sector salaries: FM

MUMBAI: Setting at rest speculation that the government may put a cap on salaries for India Inc, Union Finance Minister P Chidamabaram has said there cannot be any legislation on pay packets nor was it desirable.

The government does not legislate on salaries and government ought not, he said here, replying to a question raised by a Mumbai university research student on whether low remuneration was acting as a disincentive to attract researchers.

Government salaries were no doubt poor as compared to market salaries. In fact, government salaries no where in the world match private sector except in Singapore, Chidambaram said during an interactive session with students on Friday.

I do not think there is any comparison between government salary and salary of private sector. In fact, to come into the research field it calls for certain attitude. Are you inclined towards academics and research? He asked.

Nobel laureate and renowned physicist sir C V Raman could not have been a great scientist if he had thought he should be paid like it icons Narayana Murthy and Azim Premji. Having said that I agree that compensation for teachers, professors and researchers should be considerably enhanced. When late Rajiv Gandhi was the prime minister, it was recognised through UGC that the salary of a professor should be equal to a government secretary and i believe today the professor's salary is equal to the secretary, he noted.

I also agree that you need better laboratories, libraries and access to internet (for quality research), the Finance Minister observed.