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43% Rise in Fresher's Salary in 10 years: Is it enough for survival?

 
 

Do you know how much the entry level salary has increased in the last 10 years?
Well , the answer is 42.5%.


Based on our research on the offer letter,

  • The salary offered by Cognizant in 2005 for MCA and B.Tech graduates in NIT, Trichy was 2,11,500.
  • This year, in 2015, the salary offered is 3,01,500
  • A simple mathematical calculation would give you the answer of 42.5% increment.

Well, this is not a sustainable growth if you consider the steep rise in price of general commodities.
Most of the price has doubled in the last 10 years. The price of the basic necessity of Food, Clothes and Shelter has almost doubled in the last 10 years.

Our editorial team quickly picked up 10 items which has doubled in the last 10 years:

  • Average Rental in Koramangala area was approximately 10,000 for a small 2BHK. Now it is more than 20,000 per month
  • In 2005, the average of PG in Bangalore was Rs, 3000. Now it is close to 5,000
  • In 2005, you had the option of buying a property for 25 lakh and now, it is more than 50 lakh in a decently connected area.
  • Apparel and footwear has also spiked up. Earlier you could get a good quality sports shoes for Rs, 2,500. Now it is close to 5000 to 7000. The rate of formal wear has also increased even of you consider the discount and online shopping
  • Basic cost of food has also doubled (Raw materials as well as prepared food). Adding to the woe of people eating out, the service tax has also increased to 14% from June 2015.
  • The rate of petrol was in the range of Rs. 45 to 50 per liter. Now it is 70+ per liter in Bangalore
  • The rate of auto rickshaw has doubled in the last 10 years and still they demand extra.
  • The bus fare of Volvo is still huge. The rate could be compared to the public transport in London.
  • During 2005-2006, we had the cheap flight option of Air Deccan where you could get a cheap ticket within 1500. Now it’s difficult to get any air ticket, cheaper than Rs. 3000
  • There are a new set of obnoxious expense on smartphone and other electronic gadgets, which didn’t even existed in 2005.

Well, the salary has increased by 43% but the expense has increased by 100%.

See the mailer of  offer letter of Fresher given  by  Cognizant, in 2015.


Greetings from Cognizant.
In continuation to our discussion, we are pleased to offer you the role of Programmer Analyst Trainee in Cognizant Technology Solutions India Private Limited (“COGNIZANT”)


During your probation period of twelve months which includes your training program , you are entitled to an annual total remuneration (TR) of Rs 301, 500/-; This includes an annual incentive indication of Rs 20,000 as well as Cognizant`s contribution of Rs 11,500/-  towards benefit such as medical, accidental, life-insurance and gratuity.


Once you successfully compete the probation period, clear the required training assessments , and subject to you being part of delivery projects , your Annual Total Compensation (ATC) will be revised to Rs 3,35,000 /- . This includes an incentive component (target) of Rs 20,000/-. Cognizant will continue its contribution towards benefits such as medical, life-insurance, accident and gratuity as part of your total remuneration (TR) package.


Your appointment will be governed by the terms and conditions of employment as explained in Annexure B. You will also be governed by the other rules, regulations and practices in vogue and those that may change from time to time. Your compensation is highly confidential and if the arises you may discuss it only with your manager.


As per current plans your likely date of joining will be between March 2015 and Q2  2015. At the time of joining please submit the following documents:

  • Photocopy of your certificates and mark sheets in support of your educational qualifications (10th onwards)
  • Photocopy of your passport. Please ensure that you possess a valid Indian passport at the time of joining.
  • Four passport size and two stamp size, color photographs
  • Permanent Account Number (PAN) along with the original card.

Annexure A
NAME: name DESIGNATION: Programmer Analyst Trainee

Sl. No. Description Monthly Annual
1 Basic 7,875 94,500
2 HRA @ 60% of  the Basic* 4,725 56,700
3 Conveyance Allowance* 800 9,600
4 Medical Allowance* 1,250  15,000
5 Company`s contribution to PF 945 11,340
6 Special Allowance* 6,905 82,860
7 Incentive Indication (per annum)**   20,000
  Company`s Contribution Towards Benefit (Medical, Accident, Life Insurance and  Gratuity)   11,500
  Annual Total Remuneration   301,500

 As an associate, you are also entitled to the following additional benefits:

  • Floating medical insurance coverage of Rs 2,50,000/- per annum of self and maximum of three dependents.
  • Round-the-clock personal accident and life-insurance coverage.
  • Gratuity on separation after four years and 240 calendar days of continuous service,payable as per Payment Of Gratuity  Act .

#PF is contributed at 12% of your basic subject to a minimum of Rs 780/- per month . If you are an International Worker, it is contributed at 12% of your monthly gross compensation excluding HRA.


*Flexible Benefit Plan : Your compensation has been structured to ensure that you are adequately empowered to apportion components of your salary ina manner that suits you the best. This plan will enable you to
1.    Choose from a bouquet of allowances or benefits
2.    Redefine your salary structure with prescribed guidelines
3.    Optimize your earnings


**Incentive Indications: Incentive amount may be higher, lower or nil as per the terms described herein. The incentive program is discretionary,   subject to change, and based on individual and company performance. It is pro-rated to the duration spent with Cognizant for a calendar year and will be paid to you only if you are active on Cognizant`s payroll on the day the incentive is paid.

You can download Cognizant Salary Breakup Annexure A from here.

Although the salary has increased only by 43% but the onsite opportunities has increased. Apart from that you have a night shift allowance of Rs 300. Even if you do night shift of 2 weeks you can make an additional Rs. 3000 per month. The product companies and startup have understood this problem  and their salary and stock options has more than doubled in the past 10 years.

Well to make the job offer lucrative, even the service companies should raise the salary of Entry Level professionals.

DO YOU AGREE?

 
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