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Thursday, January 05, 2006

Salaries rising in India

It's been a long time since I wrote about talent crunch and the talent market in India. Already then did I warn about growing salaries that might help other countries to compete with India. It is happening, as this is a natural cycle.

And costs for labour has gone up dramatically: "labour cost has gone up substantially in service sector industries where new employment has been generated (and where the employment market has been heated).

For example, the labour cost in the booming information technology sector moved up from 29.38 per cent of total cost in 2000-01 to 45.29 per cent in 2004-05.

In the banking and finance sector, which has seen a drive for greater productivity and improved bottom lines, the share of labour cost declined from 41.79 per cent in 2000-01 to 34.81 per cent in 2004-05." See the earlier article about Microsoft!

So while India's rise is clearly signalling competition for many companies, it also allows other countries to rise in the overall wave upwards. And that, once again, is the fun part of competition and globalisation.

(By Asia Business Consulting)