If you thought techs made the biggest gains last year, think again…

• 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.

The total personnel costs of the top 500 Indian companies soared to a staggering 10.8 lakh crore in 2022, representing the highest growth in the past eight years. This is the first time that Indian personnel costs have crossed the 10 lakh crore mark.

The total personnel costs of the Nifty 500 – an index representing the performance of the top 500 companies listed on the National Stock Exchange (NSE) – rose by a staggering ₹1.2 lakh crore in the past year, a latest report from Motilal has found. Oswal revealed.

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.

Ola founder and CEO Bhavish Agarwal took a dig at the hire tech situation last year, saying it would be cheaper to outsource tech jobs to California’s Silicon Valley as engineer salaries in India rose multifold.

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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