- Total personnel costs in the top 500 Indian companies skyrocketed to a staggering 10.8 lakh crore in 2022.
- The technology sector contributed half – or about ₹552 crore – to this ₹1.2 lakh crore increase in personnel costs.
- In total, five out of ten rupees was spent on personnel costs spent by the BFSI and technology sectors.
Notably, the brokerage only took into account the expenses of 470 companies, rather than 500 – companies with a 10-year history.
The technology sector contributed half – or about ₹552 crore – to this ₹1.2 lakh crore increase in personnel costs. The demand for tech talent and with it their salaries grew many times last year.
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Even Pine Labs CEO Amrish Rau stressed that salary expectations were at an all-time high last year because they got “great offers.” Expected salary increases ranged anywhere from 30-80%, most were in the higher range of over 60%, according to specialist employment agency Xpheno.
Technology sector still fell short
Despite the comments and memes, the technology sector was not the biggest driver behind the increase in total personnel costs. The sector that took first place is non-bank financial companies or NBFCs.
According to the Motilal Oswal report, personnel costs increased by 23% in the NBFC sector which falls under the banking, financial services and insurance sector or BFSI sector. For the technology industry, the number stuck at 19%.
While tech hires and salaries are up in 2021, the banking and financial services industry has never had a dull time in the past two years thanks to good credit growth, reduced interest rates and more.
In fact, earlier this year, four Indian banks – SBI, HDFC Bank, ICICI Bank and Axis Bank – and finance company HDFC were among the top ten Indian companies in the Forbes Global 2000 list because of their performance last year.
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