[raksrules]

Originally Posted by poloman

This is contrary to rosy picture painted by IT companies. May be there is a big bubble building up post COVID in IT.

Has the great resignation phenomenon reached India? In my team hardly 1% has resigned in last 1-2 years.
I am highly reluctant to believe any of the IT related stories appearing in media.

Yes the great resignation phenomenon has reached India I feel almost 6+ months ago. My team has so many resignations currently and that is company wide, not only my account / team. Our team is facing knowledge erosion due to this as people with several years of experience in same account leaving, and those shoes being filled by new people who struggle with settling in a new account for them.

I have seen people being retained for 100% hike of their current salary. This was unheard of 2-3 years back I feel. Obviously the 100% hike cases already had pretty low salary to begin with but I also saw people with decent salaries for their experience level / grade get 50+% salary hike which is just bonkers.

[poloman]

Originally Posted by V.Narayan

While I recognize that this thread is largely for employees and their experiences but speaking for a moment for the employer - these sky rocketing salaries are not sustainable because we don't have sky rocketing prices that the customers are willing to pay. To an extent this is a unusual churn caused by economic and emotional outburst from the covid19 phenomena. No industry in any country can sustain 30% to 100% increase in wages or any other input factor cost without a corresponding raise in selling price. In my 4 decades of work & business experience no employee has ever become 40% more productive in the value of his output overnight. This look like trouble waiting to happen. While some members on this thread view their employers as the enemy fact is the employer also finds this turn of events impractical and it is being discussed, watched and acted upon by the other side too.

Narayan sir, there is another side to this story too. Engineers especially freshers and lower experience level grades have been mistreated by companies for long. The entry salary in these companies have been stagnated at around 3LPA for over 2 decades. Since the supply has outpaced demand so far, companies could get away with it. Now with Covid, employees are fighting back.

it is not person becoming 40% more productive, it may be case of people being under paid, asserting themselves and company correcting the pay imbalance.
As I mentioned the attrition in my team and to a larger extent in my company ( US semiconductor product company)is around 1%. This shows the phenomenon is limited to those companies who were paying well below industry standard.

I don't believe in this 'great resignation' mindset of vilifying employers, resigning and sitting at home. Sooner or later they will realize this is not a viable long term alternative to working. We all care for the family, that does not mean sacrifice a productive life and sit at home 24x7.

[dragonfire]

Originally Posted by raksrules

Yes the great resignation phenomenon has reached India I feel almost 6+ months ago. My team has so many resignations currently and that is company wide, not only my account / team. Our team is facing knowledge erosion due to this as people with several years of experience in same account leaving, and those shoes being filled by new people who struggle with settling in a new account for them.

I have seen people being retained for 100% hike of their current salary. This was unheard of 2-3 years back I feel. Obviously the 100% hike cases already had pretty low salary to begin with but I also saw people with decent salaries for their experience level / grade get 50+% salary hike which is just bonkers.

I think unlike the USA, where people are quitting to lead a life of leisure, here people - mostly in IT - are quitting for better prospects. Many sectors - like Telecom - received a boost thanks to Covid and most service companies are brimming with new orders.

IT companies are recruiting like crazy and people are jumping ship for higher salaries. This may be the opportunity for those "loyal", "underpaid" long timers to put in their papers and ask for their due.

[m8002?]

This is not just entry level folks in services companies. Its happening across all levels in all companies. Let me give you just an example.

I had an application 2 months ago from an Engineering Manager who had joined a large US based retailer in Jan 2021. His current salary is 90+ lakhs per year. Maybe he is a superstar and deserves that. But he wants to change since he does not like the "environment" and was asking for a 40-50% hike. This was when talking to the recruiter. Of course, we did not continue with him. I dont know how much of an increment he got for his previous jump. But if the guy thinks he was underpaid and he is fighting back, he is living in la la land.

And he is not an exception. I did have more resumes with similar expectation but not this high pay. So everyone is out there looking to make hay when the sun shines.Like Narayan Sir says, just make sure you are settled and productive in one company when this music stops. The first hit would be people in the middle of a transition.

I have a question for people from non-IT industries - Manufacturing, healthcare, etc. Are you also seeing this phenomenon in India? In the west, the great resignation is across sectors - with healthcare and hospitality impacted the most.

[am1m]

I think there's a big difference in the 'great resignation' as it was first identified in the US and now in the IT sector here.

From the articles in the US magazines, it would seem that the resignations there were also driven by lower-paid workers leaving because the covid-relief packages offered by their government were higher than the low minimum wage they were making. (Though the numbers are apparently also significant there in the IT sector driven by better pay and more flexibility.)

Here I think it's almost entirely in the IT sector and driven by some pretty big hikes for the 5-10 years experience bracket. Which has always been a hot bracket to jump jobs anyway, just that the hikes being asked for and given are much higher these days.

Was covered already in another thread:

https://www.team-bhp.com/forum/shift...ml#post5181213 (Post-Covid work effects)
https://www.team-bhp.com/forum/shift...ml#post5181183 (Post-Covid work effects)
https://www.team-bhp.com/forum/shift...ml#post5182688 (Post-Covid work effects)

[Turbohead]

Originally Posted by dragonfire

. This may be the opportunity for those "loyal", "underpaid" long timers to put in their papers and ask for their due.

Is it worth being loyal to a company? Or is it better to switch every 3 years in the long run?

[V.Narayan]

Originally Posted by poloman

Narayan sir, there is another side to this story too. Engineers especially freshers and lower experience level grades have been mistreated by companies for long. The entry salary in these companies have been stagnated at around 3LPA for over 2 decades.

Well said @poloman. I agree with you that the larger WITCH companies have suppressed salaries for a very long time and combined that with a poor human resource management attitude. In the IT software development industry the employee is a unit of output. Sad but true.

My life and business, till I was full time in commerce, was in more traditional industries where unions {even though not necessarily militant, though I suffered a taste of that too} for all their faults kept management honest. Management is the ruling party and the unions are the opposition. We all know what happens in a Govt with no effective opposition. Hence we have the HR horror stories of callousness in IT. These HR stories from the big IT companies would find it hard to happen & sustain in a unionized large brick and mortar business. The Govt's in the early 1990s exempt IT from unions and labour laws in order to encourage a growth industry and grow it did. IT put India on the map. But it also led to an attitude of shabbiness.

I don't believe in this 'great resignation' mindset of vilifying employers, resigning and sitting at home. Sooner or later they will realize this is not a viable long term alternative to working. We all care for the family, that does not mean sacrifice a productive life and sit at home 24x7.

Having been an employer and vendor {to giant MNCs} I can only share my learnings - in the end the employee cannot out negotiate or out wait the employer especially a big employer. Similarly in the long run a vendor cannot out price himself from the principal's price comfort zone and expect to thrive. It is ultimately the law of the jungle.

Originally Posted by am1m

I think there's a big difference in the 'great resignation' as it was first identified in the US and now in the IT sector here.
From the articles in the US magazines, it would seem that the resignations there were also driven by lower-paid workers leaving because the covid-relief packages offered by their government were higher than the low minimum wage they were making. (Though the numbers are apparently also significant there in the IT sector driven by better pay and more flexibility.)

+1 to that. Minimum wage in USA apples to apples is far worse than minimum wage in India. Way worse.

Another phenomenon in India is this rash growth of "loss making unicorns" and unicorn wanna be's .They are busy burning equity to buy customers and employees and upsetting the price balance in both segments. Short term gain for some. Long term disequilibrium for all.

[akshaymahajan]

There are multiple problems:
1. Some people are underpaid because a lot of organisations dont value their employees until its too late. And the salary bands defined for a single role are just crazy.
2. A lot of start ups have way too much (investor) money
3. People dont know their worth. If person x who is a fabulous developer gets a 80 percent hike from his 7 LPA job, the person who is just average but making 15 LPA thinks that they are also entitled to an 80 percent raise.
4. #3 means that this average developer will settle for a 50% hike at 22 LPA and the person x is now underpaid again. And then comes another job change.
5. A lot of numbers going around the market (and on LinkedIn) involve ESOPs that vest over time.

There are limited brilliant people. But since everyone is hiring, there is a lot of demand. Once the few brilliant people refuse the offer presented by a company, their standards go lower. But hiring quotas are still to be met.

Is it sustainable - definitely not. The smaller, profitable companies are already bearing the brunt of it. Currently, I work with colleagues (external contractors) from 4-5 different Eastern European countries and they are a great lot. I would rather do that than try to match Soft Bank's paying power.

[somspaple]

Originally Posted by Turbohead

Guys, I work in one of the 'WITCH' companies and we're providing services for an MNC.

Turns out our client decided to cut down on it's tech budget which is going to result in layoffs in our project. All this after nearly 30% of our colleagues resigned in the past 6 months.

Is this the beginning of the end of the dream run in service based companies? Or am I stuck in some useless project? Wish I had jumped earlier but didn't have enough YOE to do the same.

It could also be just the year-end budget cuts. One of the companies I know of 'suspended' all ongoing development spending abruptly. Plan is to resume the work early next year once new budget/plan is in place. One of the advantages of contracting out - provides greater freedom albeit at higher cost.

[m8002?]

Originally Posted by V.Narayan

Well said @poloman. I agree with you that the larger WITCH companies have suppressed salaries for a very long time and combined that with a poor human resource management attitude. In the IT software development industry the employee is a unit of output. Sad but true. .

Let me play the devil's advocate here. The companies have one of the two choices when it comes to salary:
1. Start with a lower salary and give big increments ( what happens in India in general and WITCH companies in particular )
2. Start with a high salary and give smaller increment ( what happens in west).
There will not be one company in the west which pays 10 times the salary of a fresher for a junior manager. But thats sort of the norm here.

These companies know very well that with the thousands of graduates coming out, they can get people to work at low salary for a couple of years. Then its a free for all -good performers get good hikes while others quit and join the competitor with good hikes .

Product companies pay 2-3 times higher starting salaries but the numbers they take are very less. For example, my company picks 3-5 students while TCS picks 300 from the same campus.


Disclaimer : I have never worked in a software services company.

[adisan]

My two cents:

When an IT company hires or retains a resource by giving big hike, more often than not it is because they have an immediate need to deliver their projects. They will plan to offset the rise in cost by letting go of under-performing resources in due course.

How long will this trend of offering big hikes sustain? Most probably till they get new, key projects to be delivered.

[V.Narayan]

Originally Posted by m8002?

Let me play the devil's advocate here. The companies have one of the two choices when it comes to salary:
1. Start with a lower salary and give big increments ( what happens in India in general and WITCH companies in particular )
2. Start with a high salary and give smaller increment ( what happens in west).

These companies know very well that with the thousands of graduates coming out, they can get people to work at low salary for a couple of years. Then its a free for all -good performers get good hikes while others quit and join the competitor with good hikes .

One reason companies like to/are compelled to pay a low starting salary in India in almost any industry is because the fresh graduate is so utterly untrained to handle the simplest task on the shop floor/market place on his/her own. In my ex-industry -Aviation - engineers had to be put through about 2 years of shop floor real world training at significant cost and management effort before they were considered to be contributors in the minimum sense. Hence the motivation and need at least in my industry to pay Rs 3 lakhs per year for a starter and jump it 3X only once he/she passed all the real world exams (in our case actual theory and practical exams). As you correctly point out the situation is rather complex and not a simple IT 'employers are ogres' that some members tend to see it as.

[ninjatalli]

Originally Posted by V.Narayan

In my ex-industry -Aviation - engineers had to be put through about 2 years of shop floor real world training at significant cost and management effort before they were considered to be contributors in the minimum sense. Hence the motivation and need at least in my industry to pay Rs 3 lakhs per year for a starter and jump it 3X only once he/she passed all the real world exams (in our case actual theory and practical exams).

I don't think it's as simple as that. To counter to your aviation example, 15 years ago, many of my peers were thrown into managing antiquated tech systems after just 1-2 months of 'training'. In fact for my batch, that training was canceled stating we all were Computer Engineers from 'best' colleges and could handle client work directly (and which we did after ~2 weeks of joining).

Some of those peers who slogged from day 1 and learnt on the job and did an excellent job are exactly the people I hear/see getting 50% upwards of raises even now.

I think employers (especially on the tech side) have had a great run with the cheaper labor arbitrage wrt Indian labor. Now things are getting more similar - many of my friends in developed countries are astonished at the salaries their peers back in India are getting and are increasingly thinking of coming back just on this aspect.

But yes, this won't continue for long - people need to choose wisely what they are agreeing for on roles & responsibilities (while getting fat pay rises). Else it's going to be a burnout within a year or two for sure.


Edit: I think what's happening is every firm has serious resource crunch (either on it's own or due to attrition) - the best of every firm are getting poached with money as the key lever. So in a butterfly effect situation, pay hike asks are flowing down the levels.

A different example - a friend in a Big4 consulting firm was hiring a young resource for a hike of 20%. Process all done and resource had verbally accepted, when he discloses that he got another offer of ~45% from a competing firm and then eventually agreed to join a 3rd firm for nearly 80% hike. My friend disclosed that that guy's existing salary was quite low for his level and intelligence but the HR team had kept the hike to 20% instead of offering him market rates (at least 40%) and lost while he looked around for other options.

2+ weeks of time & efforts lost. Who's to blame? I'm sure the HR team would put this to "crazy" hikes in the market.

[poloman]

The cost of living gap between developed countries like US and India is consistently narrowing.If
this is the case, why should people get different salaries if they are doing similar work in two geographies. So naturally the salary divide also will close the gap.

[m8002?]

Originally Posted by ninjatalli

A different example - a friend in a Big4 consulting firm was hiring a young resource for a hike of 20%. Process all done and resource had verbally accepted, when he discloses that he got another offer of ~45% from a competing firm and then eventually agreed to join a 3rd firm for nearly 80% hike. My friend disclosed that that guy's existing salary was quite low for his level and intelligence but the HR team had kept the hike to 20% instead of offering him market rates (at least 40%) and lost while he looked around for other options.

2+ weeks of time & efforts lost. Who's to blame? I'm sure the HR team would put this to "crazy" hikes in the market.

I am surprised your friend, who is the manager, was unaware of his company's offer to that candidate. If the candidate was worth it, shouldn't he have intervened in the beginning itself rather than blame HR and the HR blaming the market?

Just to add, in the current market, irrespective of the offer, there is alaways another guy who is willing to pay more.