The hot topic today in any Govt R&D organization like DRDO/CSIR/ISRO are talent/manpower crunch of engineers/scientists and lot of young engineers are leaving these organizations to private sector thanks to the booming software industry. Govt institutions are finding it difficult to recruit 100 or 200 engineers whereas Infosys, TCS etc., announce recruitment of 10,000 engineers per year.
We will discuss the advantage and disvantage of the govt sector and the private sector to make the informed decision and main emphasis on such discussion will always start from the pay package. The main reasons cited for their leaving is pay packages offered by govt R&D organization are far below than what is offered by private sector. We will discuss each point one by one. Is it really true.
Let us take the case of pay package first.
We will take the case of a fresh recruit in any company like Infosys or TCS etc., and these companies offer a CTC (Cost to the Company) to an average of Rs.3.00 Lakhs P A and their typical pay slip is as follows :
Monthly Annually
Basic 5000 60000
HRA 2500 30000
Conveyance 800 9600
Medical 1000 12000
Special Allowance 6500 78000
CCA 750 9000
Meal Voucher 1000 12000
TOTAL (A) 17550 210600
EPF 600 7200
Gratuity 250 3000
Medical Insurance 750 9000
Performance linked
Bonus 6000 72000
TOTAL (B) 7600 91200
TOTAL (A+B) 25150 301800
CTC means cost to the company incurred by the company towards employee and companies counts every rupee spent on its employee. In the instant case, if you see the net salary received in hand as per “A” is Rs.17550 only and rest given towards PF, ESI, Medical Insurance etc., Further, the performance Linked Bonus is a is based on the performance and payable to the employee on roll when it is declared . No one is aware of his performance and if he resigns before he forfeits his entire amount.
we will will take the full amount in our case Rs.6000 and the total take home in that case will be Rs.17550 + Rs.6000 = Rs.23550. Hence one finally get s a take home of Rs.23550.
We will take an illustration of a fresh recruit in any R&D organization in a metro cirty. On joining the engineers salary will be as follows :
Monthly Annually
Basic Pay 8000 96000
DP 4000 48000
Dearness Allowance (41%) 4920 59020
HRA 30% 3600 43200
Transport Allowance 800 9600
CCA 300 3600
Professional update
allowance 416 5000
22036 264440
The final take home of engineer in govt R&D institution is Rs.22036. and if you compare it what they get in private sector both are on par.
Further these R&D institutions have the campuses along with the Offices and staying in the campus is a great advantage and these institution have the facility of 100% accomodation for engineers. Further these campuses are very vast and act like a gated community with security and greenery. In such a scenario, it is a five minute walk to the office and spending quality time in office and family with full of energy .
In contrast compare the situation in any software industry in any metro ,like bangalore where most of them are located on the outskirts of city and one has to commute hours to reach them because of traffic and typically a employee spends 3 to 4 hrs in traffic before reaching office . This is the situation software companies want to avoid wherin their employees are tired before reaching the office.
You can see from the above that there is no diference between the two and and in some factors govt job is more preferable. We will also see the PF, Medical etc.
Then where is the problem and govt R&D institution are not able to attract people.
We will discuss
Please post your comments to discuss and discover.
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3 comments:
I do agree with you. However, what I have observed is the intial start is what you have indicated. But, I have seen personally instances especially in Campus Selection which is done much prior to their completion of course at least 8- 10 months in advance and by the time they join , their pay has been hiked twice and their first salary is in the range of Rs.25000/- plus. Secondly, I have also observed that, the salary rise is not fixed like us only once in year with DA rise at intervels. The hike what we get and their increase in pay do not match and the intervels though specified generally as once in a year , they do not strictly subscribe to it. I have seen instances of rise in pay pay within six months based on the performance. The rise in pay is different for each person as it is performance linked unlike in Government which is fixed based on the post. Probably, the 6th Central pay commission will be addressing these issues for rectifications to make the Govt. service attractive.
with regards,
Vishwanath
Of course i agree that govt institution will not be providing the increment as offered by private sector.
but remember this all due to booming economy and higher earnings, profits of the companies. Now indian economy is growing at 9 per cent annum for last couple of year. if you read today's newspaper the grwoth is going to decelerate as per RBI
Forecast, and also as per MOODY'S rating agency.
The software industry is mainly thriving on income from USA and any recession in growth there, Raising rupee is going to affect the profit line of these companies which has happened now and every body is waiting for the second quarter result.
if there is a recession and these companies will not give the socalled phenominal hikes and you can expect only pink slips as happened during dot com burst.
If there is a job cut of about 2% in these companies (which is a worst possible case) with huge number like 35000 to 40000 employees on their roll nearly 5000 employees will be on street of the top five companies.
With the all the disadvantages so called in govt sector, if you see from the 2nd pay commission there is an 10% annual salary hike whether our economy is doing good or bad.
But these is not the case for companies and they are bound by business cycle of raise and fall of the cycle.
if you remember the old market leader of that time like bombay dyeing , vimal has gone. Now reliance industry itself focusses on petrochenical on bigway. I do not know the whereabout of vimal brand.
My sugfgestion is only to make a informed decision without any haste .
There are many issues being ignored here .. My friend advocating private sector is gorgetting
"Those Fringe benefits paid other than salary"
More over a new recruit after 6 months is sent for some official work within india he is Paid for hotel stay and food as "ACTUALS" in Govt. the person gets Rs 500 for Hotel Stay AND Food in MUMBAI .. YES 500 for (Hotel _ Food _ Travel) in MUMBAI per day.
50% of private sector people in software industry go to other countries on project .. then they get handsome overall savings of 1 lakh per month.
Dont forget Stock options.
There are many more benefits in Pvt sectors
To sum up a person in PVT after 10 years will have atleast 50 lakhs in bank ... Govt employee who had scored atleast 10% more in college degree will have mere 5 lakhs in his bank (TOTAL SAVINGS) after 10 years of service (1998-2007).
THAT IS WHY MY FRIEND PEOPLE DONT JOIN GOVT.
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