Bangalore: Infosys Ltd and Wipro Ltd on Thursday announced high single-digit wage hikes for employees, in a year when the software exporters lagged average sector growth rates and disappointed investors.

Average salary increases at these companies have dropped from 10-12% in recent years and from about 15% before the slowdown of 2008.

Infosys, India’s second largest software exporter, said it will raise annual salaries for employees in India by 8% on average from 1 July. Salaries at Wipro, the country’s third largest software firm, will increase by 6-8%, effective 1 June.

Infosys’s employees based in other countries, who were not covered by salary increases in February, will receive an average raise of 3%. The global sales team will receive average salary increases of 8%, effective 1 May, it said.

Wipro has increased average salaries for on-site employees by 2-3%, also effective 1 June.

For high performers, Wipro said it has “awarded double-digit hikes".

Most human resource experts and executives from recruiting firms feel that the hikes offered by Infosys and Wipro were on expected lines and fair, even though average salary increases at top information technology (IT) firms have declined over the years.

“The world is in an uncertain phase right now. These companies were on a rocket to the moon (a few years ago) because of the global markets—but right now, there’s a lot of uncertainty all over the world. It would’ve been irresponsible for these companies to amplify salary hikes now and double-digit salary hikes is a phenomena that most Indians will have to get used to as a thing of the past," said Manish Sabharwal, chairman of staffing firm TeamLease Services Pvt. Ltd.

Last week, Mint reported that Wipro planned to raise salaries in high single-digits on average across the company, and had put in place a new incentive structure that would reward junior programmers based on billable hours and senior managers based on client satisfaction.

Infosys is facing its toughest period ever and has brought co-founder N.R. Narayana Murthy out of retirement to revive its fortunes, nearly seven years after he stepped down from all executive roles.

Infosys lost its title of sector bellwether to rivals Tata Consultancy Services Ltd and Cognizant Technology Services Corp. after a string of disappointing results over the last two years.

It upset investors again with its March quarter results and a revenue growth forecast that was far lower than the average industry expectations for 2013-14.

Over the last two years, the company has missed its own revenue forecasts and it stopped giving quarterly guidance in June last year. In 2012-13, its full-year revenue grew by more than 5%, barely meeting its own guidance.

India’s $108 billion IT industry is facing the biggest transition period in its history, with newer disruptive technologies such as automation threatening its traditional business model that deployed large numbers of fresh engineering graduates every year to keep down the cost of software development and maintenance projects.

Top clients of Indian IT firms are shifting to newer pay-per-use billing models that de-link project fees from the number of people deployed in a project, making it tougher for companies to hire and keep large numbers of engineering graduates on their rolls every year.

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