India Inc's combined salary and wage growth slows amid muted demand

India Inc's combined salary and wage growth has decelerated, with listed companies reporting just a 4.8 per cent increase in expenses for salaries and wages in the January-March quarter of 2025 (Q4FY25). This marks a significant slowdown compared to previous quarters, reflecting a broader trend of muted demand across various sectors. Analysts suggest that companies are exercising caution in their spending, focusing on maintaining profitability amid uncertain economic conditions. The slowdown in wage growth is attributed to several factors, including sluggish consumer demand and global economic uncertainties that have made companies wary of expanding their payrolls. Industries such as manufacturing and technology, which previously drove robust wage increases, are now witnessing a more conservative approach. This cautious stance is seen as a response to fluctuating market dynamics and the need for businesses to adapt to changing consumer behaviors. Despite the moderation in wage growth, experts remain optimistic about the long-term outlook. They anticipate that as economic conditions stabilize and demand gradually picks up, companies may revisit their compensation strategies. In the meantime, firms are likely to focus on enhancing productivity and operational efficiency. The current scenario presents an opportunity for businesses to innovate and streamline operations, potentially setting the stage for a more balanced and sustainable growth trajectory in the future.

— Authored by Next24 Live