Concern in govt: Pvt sector profit at 15-year high but salaries stagnant
Financial Express Lucknow|December 12, 2024
● From services to manufacturing, wages show marginal growth
AANCHAL MAGAZINE & SANDEEP SINGH
Concern in govt: Pvt sector profit at 15-year high but salaries stagnant

THE SHARP SLUMP in economic growth rate to 5.4% in July-September this year has sparked concerns among policymakers that low single-digit income growth in the corporate sector despite 4x (four-times) growth in profits over the last four years, is one of the reasons for slowing demand.

What has triggered conversations within corporate boardrooms, key economic ministries, and between the two, is a report prepared for the government by industry chamber Ficci and Quess Corp, a tech-enabled staffing firm with 3,000-plus clients, which showed that the compounded annual wage growth rate across six sectors between 2019 and 2023 ranged between 0.8% for the engineering, manufacturing, process and infrastructure (EMPI) companies and 5.4% for fast-moving consumer goods (FMCG) firms.

What has made matters worse for workers even in formal sectors is a meagre or negative growth in real incomes i.e., wage growth when adjusted for price rise or inflation. Over the five years from 2019-20 till 2023-24, retail inflation rose 4.8%, 6.2%, 5.5%, 6.7% and 5.4%, respectively.

Chief economic advisor V Anantha Nageswaran referred to the Ficci-Quess report in at least a couple of his addresses in corporate gatherings, and suggested India Inc needs to look within, and probably do something about it. Sources in the government said weak income levels were one of the reasons for subdued consumption, especially in urban areas. "Post-Covid, consumption rose with pent-up demand, but the slower wage growth has brought to the fore concerns about a full economic recovery to the pre-Covid phase," a source in the government said.

This story is from the December 12, 2024 edition of Financial Express Lucknow.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

This story is from the December 12, 2024 edition of Financial Express Lucknow.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

MORE STORIES FROM FINANCIAL EXPRESS LUCKNOWView All
Financial Express Lucknow

A middle-class meltdown

Economic shift, stagnating real income post Covid weigh on spending on daily items

time-read
3 mins  |
December 25, 2024
Financial Express Lucknow

Shyam Benegal cremated with full state honours

Veteran filmmaker Shyam Benegal, a pioneer of India’s parallel cinema movement, was cremated with full state honors on Tuesday.

time-read
1 min  |
December 25, 2024
Financial Express Lucknow

Champions Trophy: India to play Pakistan on Feb 23

INDIA WILL PLAY all their matches of the Champions Trophy in Dubai with the marquee clash against arch-rivals Pakistan scheduled on February 23, the International Cricket Council (ICC) announced on Tuesday.

time-read
1 min  |
December 25, 2024
Financial Express Lucknow

Net gains: Secured Virat, cautious Rohit gear up

INDIA GOT A chance to bat in the nets on fresher pitches on Tuesday, their last day of training as Christmas day is a rest day for them.

time-read
1 min  |
December 25, 2024
Financial Express Lucknow

Local satellites push draws 30 aspirants

The applicants for INSPACe's latest effort in this regard include startups such as Google-backed Pixxel and Baring Private Equity-backed SatSure, as well as larger entities like Tata Group's Tata Advanced Systems.

time-read
1 min  |
December 25, 2024
Financial Express Lucknow

₹2-cr fine on Deloitte Haskins for Zee audit

In September 2018, the chairman of ZEEL, who is also the promoter of Essel Group of Companies, issued a letter to Yes Bank, and committed ₹200 crore of fixed deposit (FD) of ZEEL as a guarantee for the loans given by the bank to group company Essel Green Mobility.

time-read
1 min  |
December 25, 2024
Financial Express Lucknow

Labour-intensive exports: Gains likely to be short-lived

India's textile export growth is likely to be short-lived despite a recent surge, driven by factors such as a volatile rupee and instability in neighboring Bangladesh. While this presents opportunities, long-term gains require competitiveness and product diversification.

time-read
2 mins  |
December 25, 2024
Financial Express Lucknow

Economists for FTAs, land & labour reforms

RCEP was signed by the group of countries in November 2020 except India.

time-read
1 min  |
December 25, 2024
Financial Express Lucknow

Uniting for greater good

COLLABORATIVE PHILANTHROPY IS not a new idea. History has many examples of communities coming together for the common good.

time-read
4 mins  |
December 25, 2024
Financial Express Lucknow

EAM in US to boost bilateral ties

IN WHAT IS expected to be the first high-level contact between the incoming Trump 2.0 administration and the Indian government in its third term, external affairs Minister S Jaishankar is likely to meet the new Trump team in the US.

time-read
1 min  |
December 25, 2024