Monday, May 21, 2007

Increasing salaries on campuses

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Looks like the Students never had a better start to corporate careers like today. It is also a reflection on the sad state of Indian academic output where companies have to interview 1000 students to select 40 (if they are lucky!). For most parts, our educational system is out of sync with the requirements of the industry.Here is the article from Business Line that appeared today.

IT majors firm up hike in entry-level salaries

Bangalore: As campus recruitment by IT services firms for 2008 gathers momentum, salaries being offered to fresh engineering graduates are reaching new highs, breaching the Rs 3-lakh mark.

Major IT firms and even some mid-size ones have increased their entry-level compensation packages by 10-16 per cent, as competition intensifies to attract the best talent from campuses.

Typically, IT firms start campus recruitment 12-15 months in advance; the hiring process for 2008 began in March-April and is set to peak in July-August, once the exams of sixth semester are over.

Sources at TCS confirmed that the company had raised its entry-level package by 10-15 per cent for graduates joining in 2008.

TCS is offering annual salaries ranging between Rs 2.7 lakh and Rs 3.3 lakh, depending on the colleges and course streams.

Wipro is contemplating a 10-15 per cent hike in freshers' salaries, according to Prateek Kumar, Corporate Vice-President (HR).

For graduates joining in 2007, it had offered Rs 2.4-2.7 lakh per annum.

Market sources said that Infosys and Cognizant have also revised the compensation package for freshers.

However, T.V. Mohandas Pai, head of HR at Infosys, said that the company was yet to take a call on the issue.

The Infosys compensation package for graduates joining in 2007 stood at Rs 2.75 lakh per annum.

The fat packages from larger firms are putting pressure on smaller firms to increase salaries.

"We have little option other than increasing our entry-level salaries to get the right talent, as other major IT firms are doing it," said Puneet Jetli, Vice-President and Head (People Function) at MindTree Consulting.

For graduates joining in 2008, MindTree has hiked the package by 16 per cent to Rs 3.2 lakh.

Denying that Cognizant has hiked salaries for candidates joining in 2008, a spokesperson said: "Our guidance is only for 2007."

For graduates joining in 2007, Cognizant has been offering Rs 2.61 lakh, he said.

In the current fiscal, the IT industry is expected to hire some four lakh people, of which around two lakh are likely to come from engineering colleges.

The top five services firms are seen hiring over one lakh people, of which 60-65 per cent would be freshers.

Besides, multinationals such as IBM, Accenture and EDS, among others, are also expanding their offshore centres by hiring tens of thousands of freshers, offering packages normally considered higher than what Indian companies offer.

The annual wage inflation of 12-15 per cent experienced by IT firms would well be reflected in the salaries for 2008, analysts said.

Though some players might have jumped the gun by raising entry-level packages, it is only a matter of a few more weeks before others may follow suit, as the war for talent at the campus intensifies come July-August this year.

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