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With better economy, India Inc staff spend are steadily increasing. It is reflected in the corporates manpower cost during January-March 2010. A study of 615 corporates (excluding banks and NBFCs) carried out by FE reveals that staff cost increased by 11.7% to Rs 17,809 crore in January-March 2010 from the level of Rs 15,951 crore in January-March 2009. The total expenditure of these companies taken together increased by 44.8% to Rs 2.08 lakh crore from Rs 1.44 lakh crore during the above period.But the share of staff cost in total expenditure has steadily decreased from 11.08% in January-March 2009 to 8.54% in January-March 2010.The staff cost to sales ratio also decreased steadily from 9.28% to 7.23% during the above period. The study also finds that 69% of the selected companies have increased their staff costs during January-March 2010, as compared to the same period to the previous year.The total staff cost of the sample companies grew by 11.7% during January-March 2010, over the previous year in the same period, as against 43.3% increase in aggregate sales and 44.8% increase in total expenditure. This has resulted in a decrease in the share of staff costs in total expenditure and sales. The top five companies in terms of manpower cost in January-March 2010 are Infosys Techno, Wipro, TCS, Reliance Industries and HCL Technologies. Among these, highest increase in manpower cost is registered in the case of HCL Technologies.Of the 615 companies in this study, 321 did better with a decline in staff cost to total expenditure ratio, while 288 experienced a rise in the period under consideration. The remaining six companies showed equal ratio during both the period. Many of them, particularly those in labour intensive like hotels, IT, tea, telecommunications, entertainment and construction, showed a high staff cost to total expenditure ratio in all the three month period, meaning, they spent more on staff per unit of total expenditure. For example, Jay Shree Tea spent Rs 25 on staff for every Rs 100 spent on total expenditure during January-March 2010.Among the industries studied, significant increase in staff cost was seen in the case of automobile and ancilleries, construction, diversified, electric equipment, electronics, packaging, pharmaceuticals and steel. The aggregate staff cost of steel companies increased by 32.5% to Rs 250 crore during January-March '10.A significant increase in the ratio of staff cost to total expenditure was seen in the case of cement, electric equipment, electronics, entertainment, pharmaceuticals, retailing, steel and tea.An opposite trend was seen in the case of chemicals, IT, constructions, diversified, engineering, fertilisers, food & products, hotels, paper, petrochemicals, shipping, sugar, telecommunication, textiles, trading and tyres. The aggregate staff cost of IT companies increased by 6.6% to Rs 9,998 crore during January-March 2010.
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