[lakshmannikhil]

My understanding is that there has only been lay-off in Netflix and no where else, around the same time Microsoft made an announcement saying they are giving a considerable hike to existing employees for retaining them.

[Samurai]

Originally Posted by Arun Varma

Most of the folks who were happy about getting 100% or more increases in offers and jump jobs indiscriminately fail to realise that the salaries are always proportionate with what the company makes - cost as a % of revenue.

Correct. Most employees are under the illusion (or delusion) that companies are supposed to pay what an employee deserves. But here is a tiny problem, no one knows what any employee deserves. I mean, according whom? Instead of trying to chase this unicorn called deserved pay, companies follow a different approach. Companies pay a salary that is somewhere between what they can afford (₹A), and what the labour market demands (₹D).

Last couple years were an aberration. The US interest rate was so low, everybody borrowed money and dumped it into stock market or investment funds, which was fueling all this crazy salaries. In such times, both ₹A and ₹D raised for lot of companies. However, for lot of companies ₹D raised above ₹A, and they paid the price just to survive the crazy times, waiting for correction.

So what happened to the interest rates now?



Now you can see why money is flying out of the investment market. As BHPian sea_eagle pointed, when the interest rate is 4 times higher than one year ago, current situation is unsustainable. Interest payments will be unbearable.

Now the demand for labour will sink like a stone, ₹A will drop, ₹D will drop much further. Those who are paid much higher than ₹D and probably ₹A in any company, should really worry about their jobs.

But if you are in a company that has much higher ₹A compared to rest, you should be ok. Microsoft appears to be in that category.

[m8002?]

Originally Posted by lakshmannikhil

My understanding is that there has only been lay-off in Netflix and no where else, around the same time Microsoft made an announcement saying they are giving a considerable hike to existing employees for retaining them.

You need to start looking out more I guess. As we speak, I am interviewing a couple of folks from mFine and Vendantu who have been let go last week.

One Vedantu guy joined in Jan 2022 with a 80% hike and 30% variable pay.

https://www.businessinsider.in/busin...w/91681195.cms

[hondatoyotafan]

Originally Posted by jetsetgo08

Unfortunately, rationalization usually hits the entire team.

They do a cost benefit analysis usually the very expensive species are shipped off to a non-essential team to be sent home in the next move

[Captain Slow]

How long can companies pay this kind of crazy salaries? They have to offset the balance somewhere right? Increase their services charges or bill their customers more.

I see people demanding crazy salaries! Some freshers with little no experience demanding 2x sometimes 3x their current salaries.

The bubble will burst soon.

[efgritesh]

I am not too sure, if this will affect only those who have changed recently.

I have been associated with the industry for fifteen years now and have never seen a correction like this. In my opinion, the new reality is that everyone has corrected salary, irrespective of if they have changed or not. That essentially leaves no one at the packages they were drawing one year back.

In this case, I guess everyone is in the same boat, more or less. It would be interesting to see if the downwards correction, if at all it happens, will happen accross the board. I cant imagine that organization will fire everyone.

[warp_10]

https://www.bloomberg.com/news/artic...st-at-a-record

To give some perspective, it means that almost half the companies in nasdaq has lost half of its market cap from their peak (and this screeching halt in just 6 months). Its just that the solid companies like Apple, Microsoft, Google who have their valuations based on fundamentals are holding Nasdaq from crumbling.

For example, Zoom vas valued at $79/share before covid, they went to be valued at $500 during covid, they are back to $80-ish now. So what came as a covid tech party is just over. Back to basics and fundamentals. Not just Zoom, tons of other companies like Peloton, Netflix, Docusign (all rose on tech almost as a cure for pandemic )

What the market thought was a new world order, is not really happening. We as humans love to interact and mingle in a social environment, period.

[RGK]

This type of circumstance is caused by an excessive amount of pay. It will take at least two to three years for a startup to generate sufficient income and break even on its costs. They must stay the course and work hard to break into a market that is solely dependent on human resources.

[dextor]

I am into hiring since last 1 year and I can say the market is very tough for traditional companies who cannot pay like startups. People with less than 5 years of experience are getting paid around 400-500% of the existing salaries. And this is no more a news for anyone.
People are now out in the market searching for job not because they want change but because they heard that people are getting tremendous hikes.

We can think it as unsustainable or a temporary phase but is it really so?
In the lock down many organizations realized that if you are not online you are dead in coming days or if there is next pandemic. So now every one has started spending heavily on their IT. Every organization is racing ahead to be online. And this movement has brought up pressure not only to services companies but also to product companies.

To fulfil this sudden demand every software company needs more employees. And right now the situation is the company which has big purse is able to recruit faster. Are they able to recruit "best" is still a question or future will tell!

Is this sustainable? At the moment no one can answer. Till there is demand, this will go on.
Will demand remain for long? Depends on what the organizations are able to achieve after going online.
Going online adds to business? May be. If pandemic strikes again, this will be the saviour.

But this might not end here. Driving business online is not a one time activity. It keeps on going - maintaining the systems, upgrading, adding new functionalities etc etc.

A worrying statement I heard sometime back when one of my know person rejected onsite offer telling that he is earning better compared to what he will get in US.
India is no more a place of cheap IT labour :-)

[SnS_12]

Originally Posted by dextor

People with less than 5 years of experience are getting paid around 400-500% of the existing salaries.

What is the annual hike these guys get or expect? Or greed makes them look out to get another probably 50 to 100% hike?

A friend back in 2006-07 was working with 3G in Mumbai and was offered a job in TCS, which he took up but returned back to 3G in three months time. When we asked him the reason for the same he said he was not comfortable with the work culture. So, we asked him what made him leave 3G in the first place as he had been working there for long and he said TCS offered him a 300% hike in salary He obviously returned back not at the same pay as TCS but slightly higher than what he was getting at 3G.

Originally Posted by dextor

A worrying statement I heard sometime back when one of my know person rejected onsite offer telling that he is earning better compared to what he will get in US.
India is no more a place of cheap IT labour :-)

That is something and would be surprising if this continues to be the norm in the future.

Wonder what will be the financial and especially the phycological impact on one who had a 500% hike only later asked to take a 40 to 50% salary cut on his existing pay.

My company is into many verticals, which includes Debt, Investment Banking and Insurance, which I am part off. In end of March 2020 we received a call from our promoters who requested team members in senior capacities (including myself) across all verticals to take a 25% pay cut so that the junior or lower paid staff can receive their full salary. It was understandable for other verticals as business for them had slowed down considerably once we entered the lockdown, however the Insurance vertical continued to grow. Eventually our salaries were revised back to pre pandemic levels after 9 months but the other verticals had to wait full 2 years to get back to pre pandemic level salaries.

The above exercise meant that people down the line don't take a salary cut or worst loose their jobs even it meant taking a salary cut while your bringing in more business for the company.

[BigBrad]

Originally Posted by dextor

A worrying statement I heard sometime back when one of my know person rejected onsite offer telling that he is earning better compared to what he will get in US.
India is no more a place of cheap IT labour :-)

I know a similar story. A colleague of mine was trying to get onsite. But once the pandemic began and the salaries started growing insanely, he changed his demand and asked for an early release after putting his papers. As he was getting more or less the same financial benefit from the new job offer, it never made sense to him to relocate for the extra money. Ultimately, he got released and joined the new company. Most of those who were trying for onsite for the financial benefit has changed their mind recently.

[adisan]

Originally Posted by SnS_12

What is the annual hike these guys get or expect? Or greed makes them look out to get another probably 50 to 100% hike?

One angle I got to hear recently:
During normal years people get normal hikes.
Any adversity in the market (like the 2009 recession), or adversity in the organization (like losing a client), people get poor hikes.

Therefore, many people see an opportunity in the present conditions not only to grow fast, but also to make up for poor growth in earlier years as well as to offset any poor growth that they might face in the coming times. They are just following the adage "make hay while the sun shines".

[maverickNerd]

Eventhough shares are falling, but big companies are still growing, their profit margins are only increased in covid.

And my company gave a bonus increment to all employees due to this. So all that looks bad looking at Stocks is actually not bad. It is just a brokers emotions and sentiments reflecting over there.

[kiku007]

If you’ve stayed put at your company during the Great Resignation, you’re paying a price for your loyalty

In the Great Resignation, longtime employees — the ones who have stuck around through good times and bad — are paying a secret tax for their loyalty. LaborIQ, a compensation data provider, estimates that salaries for new hires are 7% higher, on average, than the median pay for people already employed in similar positions. Insider's Aki Ito breaks down the giant pay gap between job switchers and job stayers and what companies can do about it.

https://www.businessinsider.com/grea...ng-more-2022-5

https://twitter.com/i/events/1529195494580289536?s=20

[.sushilkumar]

Originally Posted by dextor

A worrying statement I heard sometime back when one of my know person rejected onsite offer telling that he is earning better compared to what he will get in US.

Problem is not the costly labor in India but lowest possible salaries being offered by IT companies for onsite positions in US & Other regions.

I was Offered such similar position in Canada with a freshers salary after working with organization for 5+ years & total 16+ years of experience. I choose to instead switch Job within India and I am better placed than what I was offered in Canada.

I know many of my onsite folks are getting salaries in range of 85 k to 95 K USD which is nothing IMO for a guy with 15 Years of solid experience. Heard big three even pay less in range of 60K to 70 K.