How Are IT Companies Handling Salary Increments During the Recession? Seeking Insights and Data

Hello Sir,

I am Pooja Joshi, Senior Executive HR with an IT firm in Ahmedabad.

It would be a great help if you could share your views with me regarding the current increment/appraisal trend this year in the IT industry, with recession and cost-cutting being the order of the day for most companies. It would be good if you could provide some statistical figures of the average percentage increase in salary this year or any sources from which I can get this information.

We at our company provide bi-annual appraisals, but the chances of which seem to be bleak this time around because of the recession. Can you please tell me how the rest of the industry is dealing with this issue of increments? Are IT companies providing any increments at all this time around, and if not, how are they dealing with it? Because recession or not, employees expect companies to provide increments as always, and this might lead to discontentment. How does one deal with it?

I am anticipating your quick views on this.

Thanks and Regards, Pooja Joshi

Hi Pooja,

Currently, many IT companies, even companies in other domains, are facing a market downfall named recession. Due to this, many companies are unable to pay salaries, so appraisals are far away.

Talking about appraisals, employees do understand the scenario and market structure. They should be happy that their jobs are secure and that the company is paying their salaries on time. In cases where employees are being terminated, their salaries are being reduced by a certain percentage to help control the recession and prevent losses to the company.

Therefore, it's important to explain the current situation, market conditions, and how the market and competitors are behaving. Showcase your company positively and emphasize the security the company provides. Help employees understand that even if they do not receive a 6-month appraisal, the company will provide an annual appraisal that will compensate for the missed 6-month appraisal. Additionally, assure them that the market will improve in the meantime.

Thanks

First, try to save the jobs, then think of increments. The cost of living will go down as it was artificially and abnormally gone up during the past two years. As inflation goes down, salaries should also be proportionately reduced because the real value of the job has also declined.

Market correction takes place in all spheres of economics; HR is no different. The Indian market job prices will decrease by 50% in the next two years because it was influenced by the demand and supply during the corresponding period of the market economic boom.

Badlu