The analysis is based on the annual profit and loss numbers of a constant sample of 2,230 listed companies
whose finances are available since FY12. The latest data is for the April-June 2018 quarter. The changes in companies' salary bill can be used as proxy for the changes in the corporate hiring and the general job market in the absence of employee or headcount data.
A sectoral break-up of the numbers suggests that growth is being largely led by information technology services, metal and mining, pharmaceuticals, consumption-related sectors such as non-banking retail lenders, and automobiles and auto ancillaries. “The growth recovery is being led by private consumption and export-related sectors such as IT services and metals and mining companies, and fresh hiring has resumed in these sectors after a two-year lull. The dynamism is missing in investment-related sectors as private sector capex remains in the slow lane,” says G Chokkalingam, founder & MD, Equinomics Research & Advisory.
He expects the trend to continue in the foreseeable future unless the consumption led-growth recipe is spoiled by any sharp deterioration in India’s external economic environment.
Non-bank retail lenders such as Bajaj Finance, Housing Development Finance Corporation (HDFC), Indiabulls Housing, Shriram Transport Finance and Dewan Housing topped the chart with 27.6 per cent YoY growth in the industry's salary and wages during the June quarter this year, growing at the fastest pace in at least six years. It is followed by automobiles at 18 per cent salary growth and auto ancillaries at 18.6 per cent growth.
In comparison, the combined salary and wage bill for capital goods makers was up just 5.4 per cent during the first quarter, down from 8.5 per cent growth in the last fiscal year. Similarly, power generation and transmission companies
reported a slowdown in hiring and salary growth during the first quarter of current fiscal compared to last fiscal.
There was, however, an uptick in the construction and infrastructure space with companies reporting 16 per cent YoY growth in wages in the June 2018 quarter against 9.6 per cent growth a year ago. Analysts attribute this to a pick-up in highway construction in the last few quarters forcing companies to scale up and hire more hands to complete projects.
Telecom operators though continue to trim their headcount with the sector reporting a decline in the wage bill for the third consecutive year in FY19.