A recent research from global management consultancy Hay Group reveals since 2008 the pay gap between lower level employees and senior managers in India has widened. Senior managers are paid 11.7 times more than lower level workers (skilled manual, clerical, supervisor or graduate entry jobs). The change in the average percentage difference from the start of the recession in 2008 to 2014 stands at 52.14 per cent. This increase in pay differential can also be linked to an intense talent war and increased competition for the few selected jobs available, which keeps the pay limited to a certain bracket.
The pay gap has also accelerated as globalisation opened up workforces and lower-level jobs are increasingly automated and off-shored. This reduces the number of jobs available and increases competition.
In contrast, salary is going up for senior managers where skills such as emotional intelligence, creative thinking and advanced judgement are in high demand and short supply. The report says the large job pay gap can cause discontent among the workforce. Organisations need to be transparent with employees and communicate why reward policies are in place. They should also invest in training and development programmes to upskill their workforces.
