We read these days that Start ups are paying fantastic salaries and on top of it that they are providing lot of perquisites like vacation trips etc.
Yesterday Economic Times reported that few startups increased salary by 150 % and provided lots of perquisites. And the promoters appeared rather proud.
This is an AVOIDABLE EXCESS unequivocally.
1. This excess is coming from capital funding Hence, Investors should exercise due control on the rates of increment by reigning in on such moves in board meetings.
2. It is not that talent is so irreplaceable that we need to totally break all rules by doubling salaries
3. This has a totally negative impact on the other parts of economy which is fairly large and opts for a simplistic inflation plus??? approach
4. Productivity comes not only from employees being talented but also from a highly productive culture and environment, energising vision of the entity and being part of a great team It is critical that companies spend money and efforts on creating such a culture rather than frivolously throwing money and thinking that they are buying??? talent.
5. I have seen several such employees who have gone way out of the market median finding it difficult to get a new job when such start ups go bust ( remember mortality is high among startups)
Hope better sense prevails.