No increase in salaries this year

Placements in the age of slowdown

The recession is beginning to affect final placements at premier B-schools and IITs. Recruiters are maintaining last year’s salary levels. Students have also toned down their salary expectations during the final placement season this year. Most expect similar salaries as last year, instead of the 30 per cent annual increase that has been the norm.

At the Indian Institute of Technology-Kharagpur (IIT-KGP), the placement season began in December 2008 and will run  till April 2009. Around 1,350 students will be placed during this period.

BK Mathur, chairperson , placements, IIT-KGP, said: “Starting salaries had been rising between 10 per cent and 30 per cent over the past three years. This year, several recruiters have maintained last year’s salary levels. Students have also toned down their expectations and are actually hoping for salaries to stay the same as last year, instead of a drop.”

Of the 1,350 engineering students at IIT-KGP, 475 have already been placed.

“We have invited more companies this year, and from diversified fields. Around 65 per cent of companies this year are identical to last year. The highest salary offered so far has been Rs 25 lakh. This was also the highest salary offered last year,” Mathur explained.

Companies that have already visited the campus and picked up students are Schlumberger, Indian Oil, Barkley Capital, Airbus, HP, Adventity, Tata Steel, JP Morgan and ACC.

At the Indian Institute of Management-Calcutta (IIM-C) too, students have been receiving fewer offers and that too at 2008 salary levels.

Salil Patil, placements coordinator, IIM-C, said: “The situation (in terms of salary) is the same as last year. Students have understood the problems that placements may face this year due to the recession. We are inviting more companies this year, especially from recession-proof sectors like FMCG and telecom for placements.”

Around 250 students from the institute would be placed during the final placements this year. Of these, 150-160 students are eligible for laterals. Lateral placements are for students with work-experience of over 10 months. So far, around three companies have turned up at IIM-C. Students meet over 30 companies during the 45-day laterals. In 2008, around 50 offers were made in the first week of laterals at IIM-C. In 2007, 100 offers were made during the 45-day laterals.

In the 2008 lateral placement season, IIM-C witnessed 148 offers. These were made across a variety of sectors including consulting, commercial banking, private equity, wholesale banking, IT management, general management, real estate and hospitality. The average annual package offered was Rs 14.15 lakh, while the highest domestic offer was Rs 21 lakh.

As many as 42 companies visited the campus in 2008 over a period of 45 days offering key responsibilities within India and abroad including major business locations such as the US, Europe, West Asia and South-East Asia.

According to a recent Nielsen Campus Track B-School survey, average salary expectations of students have come down to Rs 14 lakh this year. However, six months ago, during summer placements, there were no signs of economic downturn at IIM campus recruitment. Average salaries among IIM graduates were up by a whopping 30 per cent, with offers ranging from Rs 50-70 lakh. In fact, international placements ranged between $280,000-360,000.