In spite of Rising staff wages - Indian IT managers among lowest paid in the world.

The information technology sector is among India's top paymasters. However, Mercer Human Resources Consulting survey points that IT Manager in India are among the lowest paid in the world. IT managers - defined as those who are responsible for developing IT systems and managing a company's IT specialists - in India, on an average, earn $26,500 a year, the survey said.

While the top earners are IT managers in Switzerland who take home an average of $1,61,900 a year, those who earn the least are IT managers in Vietnam who are paid an average of $20,100 a year.

The survey, which covered 5,300 companies across the world, found that eight of the 10 highest-paying countries for IT managers are in Western Europe.

Japan and Hong Kong are the only two non-European nations that rank among the top 10 in terms of pay to IT managers. According to the survey, IT managers in Japan earn on an average of $1,12,300 a year and those in Hong Kong $97,600 a year.

German IT managers earn an average of $1,26,700 a year, while those in Denmark take home an average salary of $1,16,000 a year. IT managers in the US, which is ranked 14th, earn an average yearly salary of $89,100.

At the other end of the scale, IT managers in the Philippines earn an average salary of $20,700 a year and those in Bulgaria and Malaysia an average of $28,800 a year, the survey found.

However, the recent Q1 results reported by the Indian IT services firms have been marked by the impact of rising staff costs. With offshoring growing around 30~40%, requires hiring thousands of talented people every quarter. Most Indian companies tend to be weighted towards freshers to sustain the growth.

The wage pressure have been hardest on the 2nd and 3rd tier Indian firms that are not well known and do not have as deep a bench. This will get worse as 'established multinational companies like IBM and Accenture start hiring more freshers out of school'.

While the larger IT firms say entry level wage hikes are not being considered, they acknowledge that recruits between three and five years of experience is becoming dearer. Employees have been more aggressive in negotiations knowing they have other options such as IBM or Accenture who pay better salaries unlike the rock bottom paid by Traditional Indian vendors.

As, John McCarthy, the analyst, from Forrester, said, 'Remember, half of the wage increase is offset by productivity investments that the top-tier suppliers are making.' - larger Indian IT firms, are finding faster and better ways of doing a given task. They aim to use fewer people and less time to perform the task the next time round and ensure fewer errors as well.

In addition to offset the wage increase, larger, Indian and foreign firms are moving to smaller cities, while the smaller firms are moving to become specialist in niche areas.

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