The wage bills of most old economy firms increased by an average of seven per cent in the first half of the current year, compared with 11.4 per cent in the first half of 2003-2004.

To be sure, corporate India's wage and salary bill increased by 13.70 per cent in the first six months of the current financial year, compared with the same period last year, thanks to liberal increments paid by information technology companies and the voluntary retirement schemes floated by old economy companies.

Thus the double digit growth rate in salaries, which started showing up in the first half of 2003-2004, continues unabated.

But the 13.70 per cent growth rate is not an indication that the corporate sector, as a whole, is paying its employees well. Banking, telecom and pharmaceuticals companies are among the handful of sectors reporting a double digit rise in the wage bill, but there, too, the picture is skewed.

Banks and pharmaceuticals companies have had to make hefty provisions on account of voluntary retirement schemes whereas the telecom industry has been on a hiring spree.

A double digit growth in the IT sector's wage bill is largely due to a whopping 29 per cent rise in the head count in this sector. In the first six months of the current year, the top four IT firms added 27,000 employees which resulted in a 35 per cent rise in their wage bill.

Pharmaceutical firms recorded a 20 per cent rise in wage bill on the back of VRS in most of the multinational pharma companies. The wage bill of telecom companies increased by 26 per cent following VRS in some companies, aggressive hiring in some, and the implementation of a new wage package in MTNL.

The banking sector reported a 14.68 per cent rise in the wage bill on account of provision for VRS implemented in 2001.