These are the disturbing numbers which have been revealed by Hay Group, a division of Korn Ferry.
The real salary growth rate stood at 0.2% whereas the GDP gain was 63.8% since the great recession eight years back.
The highest salary growth rate
China showed the highest real salary growth rate at 10.6%. It was followed by Indonesia and Mexico where the numbers were 9.3% and 8.9%, respectively.
The worst salary growth rate
On the other hand, Turkey, Argentina and Russia were at the bottom of the list. There, the salary growth rate was dipping down to -34.4%, -18.6%,-17.1%, respectively.
The report said that most of the G20 markets stood on the either end of the the scale i.e. on the highest wage growth or the lowest growth. India however, stood totally in the middle.
The Indian Economy
The report further explained that the wage growth in India is the most unqual one. According to Benjamin Frost, Global Product Manager – Pay for Korn Ferry Hay Group, the bottom 30% are now worse off since the recession whereas the top 30% are better off.
There are a lot of reasons behind this. Firstly, there is a very high wage growth for the top or senior level jobs. It is because of the huge shortage of professional or managerial skills in the people. Another reason is that India is increasing its connection with the outside world for trade which in bringing in many big names to the nation.
Whereas the reason behind the stagnation of wage growth in the lower strata is the high population. There leads to oversupply of semi-skilled and unskilled individuals for the entry level jobs. Also, India was not very successful in creating high paying jobs, unlike many other countries.
The Develeped Economies
Among the developed nations, US is surprisingly among the worst performers where the real salary growth decreased 3.1% on an average even though the GDP growth rate has been 10.6% since the great recession.
Canada scored the most among the developed nations as the real wage growth rate here was 7.2%. It was coupled with the GDP growth rate of 11.2%.
Other developed countries witnessed a negligible to moderate salary growth rate. For Australia, it was 5.9%, France was at 5.2%, Germany 5% and Italy at 2.4%.
Apart from these, there are numerous social, economic and political factors which affect the wages and the GDP, Frost added.
What was the salary of our MP”s in 2008 and what is the salary of our MP”s in 2016 ? At what percentage it grew ? As our MP”s are the crown jewels of the nation, the rate of their salary increase should be the yardstick of the growth of prosperity of the nation and not the salary of working class.
Rohan, what you said is correct but not entirely.
Our leaders are elected by us and hence, are our representatives. Correct.
But what you are saying is that if a man who represents an entire district or state is earning more than what he used to earlier at the same position eight years ago, it means that the entire district, state or even the nation is earning more?
Anyways, the universal way to measure a country’s growth and development can never be evolved simply because every country is different from their counterparts. Different countries mean different problems along with completely different scenarios. One yardstick that would be tailor-fitted for country X might completely undervalue country Y.
This report was just an attempt to find out how were various countries recovering from the recession that occurred eight years ago and they considered real salary growth rate and GDP for that.