You have to sweat a lot to stay in the same place on a treadmill.
That’s true of the economy as well—salaries have to rise faster than inflation if you are to be better off. Consumer inflation in India has been close to double digits for quite some time now, and this is a hard fact that employees have to keep in mind as the annual battle between HR and employees, aka the appraisal season, draws to a close.
Hewitt Associates Inc. said on Thursday that salary growth in India will outpace the rest of Asia and is better than the 6.6% that employees got last year. But the average 10.6% wage hike they forecast will barely be higher than the consumer inflation rate. Add to this the inevitable fact that interest rates on consumer loans will start inching up soon, and we arrive at the harsh truth that large swathes of the middle class could have a mediocre year.
To be sure, anecdotal evidence from companies and B-schools shows that hiring is picking up and the income tax cut announced in the Budget offer some hope. Yet, cubicle slaves should worry.