Startup employees to get single-digit hikes this year

Employees in the Indian startup world had got used to of high salaries and even higher pay hikes; however, this time around, their expectations would be shattered since most startups are planning to give single-digit hikes, owing to low funds and cash crunch.

Even though there has been no official announcement yet, compensation experts are of the view that salary increases will be the lowest ever this time.

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Since the startup boom, investors have been putting in a lot of money into startups, in hope of big returns; however, most startpus faced cash crunch, forcing investors to tighten their money bags.

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Salaries, which make up for one of the biggest cash expenditures, are an easy way to take control of the cash emergency.

Even as a recent Aon Hewitt study projected the average pay hike in consumer Internet startups at 12.4%, highest across industries, experts don’t hold much hopes.

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One reason behind this pessimistic view of experts could be what happened last year, when startups had projected an average increment of 15.6%, but paid only 12.9%, a deviation wide enough to create ripples.

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"I will be surprised if people get more than 5-6% raise. The supply of talent far outstrips demand," Rajeev Banduni, CEO of advisory services firm GrowthEnabler, told ET.

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