The manufacturing sector is paving the way for higher compensation for CEOs. This sector has performed better on compensation increases than the services sector, according to a study conducted by the Chennai-based integrated HR services company, Ma Foi Randstad. In its CEO compensation trends study, it had found that the average increase in total compensation for financial year 2010–11 was 14 per cent in the manufacturing sector. The study was carried out for determining the increase in total compensation among organisations in the manufacturing and services sectors and drawing meaningful inferences on the performance of these sectors. A secondary research was conducted among 148 organisations in August with 76 of them from manufacturing and 72 from the services sector.
In the manufacturing sector, the highest increase (18 per cent) was among the power equipment manufacturers, closely followed by pharma companies. Power, particularly, has been riding on strong projections of growth.
In the services sector, the average increase in total compensation for 2010–11 was 12 per cent.
The banking, financial services and insurance (BFSI) sector lead the pack with the highest increase of 14 per cent.
Commenting on the survey, K. Pandia Rajan, Managing Director & CEO, Ma Foi Randstad, said, “Through this study, we have established that in the aftermath of the recession, there is heightened focus on the manufacturing sector. There is a greater interest generated in this sector as the result of innovations that are made possible in the sector. Also, with the international economic downturn, the focus in the services sector has shifted to bottomlines.”
If the two sectors are to be compared, manufacturing has not only been less adversely affected during the recession, but has also seen a growing demand for talent due to greenfield entrants and brownfield expansions. Besides, the service sector has come under intense pressure on margins.
Banking, financial services and insurance sector lead the pack