IN APRIL THIS YEAR, Isha Nisar bagged a marketing job with ITC after graduating from Indian Institute of Management Ahmedabad (IIM-A). Getting to choose from three offers, Isha considers herself fortunate enough to graduate in 2022.

The placement season in 2021 wasn't great, says Isha. "Fewer companies had come and salary packages were not as high as this year," she recalls the experience of her seniors at IIM-A. Isha sat for various roles, from finance to consulting, but decided to pursue her interest in marketing. "I had offers from investment banks, private equity and venture capitalists. They offered hefty salaries to the tune of ₹70-80 lakh. But I decided to follow my heart and went into marketing. I had the luxury to say no and focus on what I wanted to do because of the rich placement process."

Data from this year's Fortune India Best B-Schools Survey backs Isha's story. Average annual salaries among top 12 business schools in India saw a strong jump in 2022, up to a whopping 30%. While it was the highest at Indian Institute of Management Calcutta (IIM-C) at ₹34.20 lakh, Indian Institute of Management Kozhikode (IIM-K) saw the highest jump (30%) in percentage terms — from ₹22.53 lakh in 2021 to ₹29.50 lakh in 2022. Interestingly, the average annual salary had dropped 2% in 2021 over 2020 at IIM-K. For other B-schools, the salary hike was muted in the range of 0.65% to 13%.

However, the highest pay package was lower across colleges in 2022. In IIM-A, for example, the maximum earning potential or the highest salary offered to PGPX (Post Graduate Programme in Management for Executives) students was ₹75.2 lakh, lower than ₹82 lakh in 2021 and ₹81 lakh in 2020, data from Indian Placement Reporting Standard (IPRS) 2022 shows.

Interestingly, the minimum earning potential or the lowest salary has improved significantly in the past three years, according to the audited placement report — from ₹18.5 lakh in 2020 and ₹18 lakh in 2021 to ₹25.50 lakh in 2022.

"Enterprises around the world felt optimistic about the economic future. They realised they needed to hire more people. There was a greater amount of competition among recruiters to hire top talent. So they were willing to loosen their purse strings," says Aditya Narayan Mishra, managing director and CEO, CIEL HR Services.

International recruiters such as Goldman Sachs and JP Morgan offer better salary, improved lifestyle and exposure to a wider market, roping in top talent and resulting in a talent war. "Domestic recruiters don't want to miss out on top talent either. They end up matching the salary and perks being offered by global firms," adds Mishra.

Notably, the placement period lasts for around seven days in colleges. Most consulting and financial services firms come for the placement on Day One. Day Two and Day Five are off. Day Three and Four are mostly for marketing and general management roles, followed by product management on Day Six and Seven. "There were 64 companies and only 10 candidates on Day Two. The rest had already accepted job offers on Day One," says an IIM-A student who didn't wish to be named.

Needless to say, consulting firms emerged as the largest recruiters. They hired 31.6% students at IIM-A and 36% at IIM-B. The figure was similar for other colleges as well. Top recruiters included Accenture, The Boston Consulting Group, Bain & Company, AWS Consulting, Goldman Sachs, Microsoft, McKinsey & Company and Kearney.

Jobs in marketing and sales, general management and corporate finance and commercial banking were the most preferred after consulting roles. Specifically, online services, information technology, banking, insurance and automotive sectors ruled the roost.

The start-up boys were also not far behind. New-age firms such as Navi Technologies, Unacademy, Paytm, Nykaa and InfoEdge came for placements. On the other hand, companies such as Amazon, Microsoft, Google, Paytm, Razorpay, Oyo rooms and Angel Broking preferred lateral hiring — selecting candidates with at least a few years of work experience compared to freshers to fill open positions.

But then, which companies paid the most? "The pay offered across specialisations generally varies as per the demand in a particular sector. For example, among MBA aspirants, the consulting/services industry offers the highest pay differential to students specialising in banking and financial services and finance, followed by marketing and business analytics," says Neelesh Gupta, director, Deloitte India.

Salary Structure and Perks

While companies have been trying to increase variable pay, students across sectors prefer a high fixed pay component, says Gupta. "Corporates are also focusing on flexible, performance-oriented pay structures," he adds.

Consulting/services firms offer candidates attractive perks such as luxury apartments, cars, and travel across the world. Among others, joining bonuses are common. A few companies offer one-time payment to help students pay off their education loans, or fund their higher studies if they want to go for specialised courses, with a caveat that they will join that particular company after studies. "ITC had given me ₹3 lakh to take care of my initial EMIs," says Isha.

Students are also looking at long-term wealth creation, and hence eyeing incentives such as ESOPs or restricted stock units.

A few companies also offer a choice between their India office and a foreign location for the same role. Five out of 114 students at IIM-A's 2022 batch opted for jobs in Kuala Lumpur. Global salaries are a bit higher. The median salary for the five came in at $1,50,297 per annum. After adjusting against the rupee and non-rupee salary as per purchasing power parity in US dollar terms, the maximum earning potential in non-rupee was $4,02,929. For rupee salary, it was $1,64,813. However, most students still prefer India over international destinations.

Employees' Market

The competition among recruiters has proved to be a blessing in disguise for freshers. Employees now get to choose from more than one job offer, that too, on their own terms. The preference is for a sustainable and purpose-oriented workplace, as well as flexibility in the work.

"The reason why most students prefer consulting roles is not just money. It gives them better exit options," says Isha.

Interestingly, the trend is no different in Tier-II and III colleges. "When companies come to our colleges, they hardly have vacancies in strategic roles. They want to hire people in sales or marketing. So, while earlier it may have been about the brand and salary packages, now the preference is for better roles," says Varun Poduval, who recently completed his MBA and joined ICICI Bank.

Colleges also run entrepreneurship programmes for students, including start-up programmes, sessions on entrepreneurship and help in arranging funds in some cases. IIM-A, for example, runs IIMAvericks Fellowship Programme in which they help student founders raise seed capital. They get a placement holiday of two years during which they receive a monthly stipend of ₹40,000. If the venture does not work out, they can come back and sit for placement.

The Talent Gap

It is not that companies are at the receiving end always. They are no longer enamoured by the IIM brand, and are looking at a diverse set of colleges for hiring skilled talent. The pay is often similar to what an IIMite would receive, with some companies even offering ₹10 lakh in annual package to Tier-II graduates.

Companies may have hired in bulk and given higher pay packages this year, but they have also raised red flags over the lack of relevant skills among candidates. Gupta of Deloitte India highlights the growing demand for niche skills, such as robotic process automation, machine learning, and artificial intelligence, but campuses lack these skills at the time of demand. "This demand-supply mismatch is because it takes one year after the spike in demand for a certain skill to get incorporated into the curriculum… It is important for academia to take initiatives beyond placement offices and identify skills required at work and translate them into academic curriculum," he adds.

In short, the placement season for 2022 may have favoured candidates, but it was more of a response to 'The Great Resignation' post Covid, with a focus on entry level hiring. B-schools have an onerous task ahead — to train such talent according to changing industry demands.

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