Paytm’s rivals and other startups may be seeking talent from the troubled fintech company, but the
make it difficult for these competitors to attract employees. Paytm is known for paying salaries above the industry average, a fact confirmed by industry insiders and executives at recruitment services and search firms.
According to them, most
receive salaries that are 20-30% higher than the industry standards.
This generous compensation has made many startups hesitant to hire Paytm employees, according to an ET report.
The same situation was observed with Byju’s, a financially-beleaguered edtech firm that was once India’s most valuable startup.
As a result, many employees at Paytm are open to switching jobs, even if it means accepting lower pay. This is because the Noida-based company is currently facing regulatory pressures on its operations.
Paytm employees high salary trouble
According to Ashish Sanganeria, senior partner at Transearch, a leading executive search firm, Paytm’s leadership talent is willing to take a pay cut because listed companies’ stocks are liquid, and many startups cannot match the overall cash, including Restricted Stock Units (RSUs), offered by Paytm.
Industry experts have noted that most consumer internet startups are currently hiring employees with similar or only marginal pay increases due to the abundance of available talent. This is a significant contrast to the period of the pandemic in 2021-22, when salaries at these firms reached record highs due to a surge in resignations.
An executive at a recruitment services firm, who requested anonymity, revealed that Paytm’s strategy of offering higher base pay and equity aims to create a competitive advantage by making it difficult for rivals to replicate their talent pool.
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This trend of offering generous compensation packages is not unique to startups and is also observed in market-leading organizations across various industries. According to Pranshu Upadhyay, regional director at Michael Page India, market leaders often pay a premium of 15-20% to retain and engage top-notch talent.
During the pandemic, there was a high demand for highly-skilled tech talent, particularly in startups and tech companies, which led to a significant increase in salaries. As a result, the salaries of many employees at companies like Paytm were benchmarked at unprecedented levels. However, in the current job market, employees from such companies find it challenging to secure new jobs as the salaries available are often 30-50% lower than what they are currently earning.