MC Tech3 | Zomato makes history with Sensex entry, Pay gap widens between IT CEOs and Freshers and more; and more

In today’s Tech3 newsletter, 

Just in: Zoho-backed Silectric Semiconductor to invest Rs 3,425 crore in Karnataka

One quick thing: Zomato becomes the first new-age company to enter BSE Sensex

In today’s newsletter:

·         Indian IT CEO pay ⬆️ 160%, Fresher pay ⬆️ 4%

·         Tech policy 2024: Where are the rules 🤔

·         GST blow for Cars24, Spinny, CarDekho

Indian IT CEO pay ⬆️ 160%,  Fresher pay ⬆️ 4%

In the world of Indian IT, while CEOs continue to make merry, freshers appear to be getting a raw deal.

Driving the news Chief Executives at India’s top five IT companies have seen their salaries soar by a whopping 160% in the past five years, reaching a median of Rs 84 crore in FY24.

·         In contrast, fresher salaries saw a meager 4% increase over the same period, rising from Rs 3.6 lakh to Rs 4 lakh annually.

The data covers TCS, Infosys, HCLTech, Wipro, and Tech Mahindra.

The growing disparity If one were to look at another metric, the CEO-to-fresher pay ratio, the gap is stark 

·         Wipro leads with a ratio of 1,702, followed by Tech Mahindra at 1,383.

·         HCLTech and Infosys stand at 707 and 677, respectively, while TCS, the lowest, is at 192.

Ok, what’s the big deal?

In the second quarter of FY25, India’s GDP growth slowed to 5.4% shockingly.

·         This prompted India’s Chief Economic Advisor V Anantha Nageswaran to ask India Inc. to step up for an equitable distribution of profits between capital and workers.

Rising profits of corporates in the last five years and stagnant salary growth have resulted in muted consumption, which is worrying many in the power corridors.

“I don't know why the board is rewarding CEOs and the top 1% of people more and more while exploiting the bottom of the pyramid. It's very wrong,” former Infosys CDO Mohandas Pai told us.

Not all agree However, many industry experts say unchanged fresher salaries are a play of demand-supply.

·         One analyst pointed out that freshers require extensive training, which keeps entry-level wages low.

It's not just the IT sector, the phenomenon has been seen across industries, with wage hikes not even matching inflation in certain cases.

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