Economic Survey Calls Out India Inc, Says Corporates Raking In Profits But Hirings And Salaries Don't Match Up

The survey highlighted that employment means more than just financial compensation; it is also about dignity, self-worth, self-esteem, self-respect, and one's standing within the family and community

The Economic Survey for 2023-24, presented today by the Union Finance Minister Nirmala Sitharaman in the parliament, shows that while the corporate sector in India has been achieving impressive financial results, employee recruitment and salary increases have not matched these companies' profitability. The government emphasised, “It is worth reiterating that job creation happens mainly in the private sector that the primary driver of job creation is the private sector.”

The survey said, "In terms of financial performance, the corporate sector has never had it so good. Results of a sample of over 33,000 companies show that, in the three years between FY20 and FY23, the profit before taxes of the Indian corporate sector nearly quadrupled... 

However, the survey pointed out that “hiring and compensation growth hardly kept up with it. It is crucial for the companies to step up hiring and worker compensation,” it added, underlining the situation's urgency.

The Economic Survey emphasised that numerous factors affecting economic growth, job creation, and productivity are governed by state governments. It advocated for a tripartite agreement involving the Centre, state governments, and the private sector to fulfil Indians' increasing aspirations and achieve the vision of a developed India by 2047.

Employment More Than Just Financial Support

Additionally, it highlighted that employment means more than just financial compensation; it is also about dignity, self-worth, self-esteem, self-respect, and one's standing within the family and community. “That is why it is in the enlightened self-interest of the Indian corporate sector, swimming in excess profits, to take its responsibility to create jobs seriously," the survey noted.

However, the survey emphasised that India Inc. needs to recruit individuals with the appropriate attitude and skills for various jobs. Collaboration among the Centre, private sector, and academia is not just important but essential to achieving this goal. 

"A corporate sector that helps shape the design of higher education with inputs to curriculum, evaluation standards, and faculty will pave the way for a high-quality higher education that market competition brings, replacing regulatory oversight," it said.

Finance Minister Nirmala Sitharaman is all set to present the Union Budget 2024 on Tuesday at 11 am in the parliament.