Fair Play on Fair Pay

When workers don’t get fair pay, it may help companies for a while. But after some time, everyone can lose

One of India’s highest-paid CEOs recently walked onto a stage at a company event. Instead of cheering, many employees shouted, “We want hike,” asking for higher salaries. This is unusual because most Indian workers are afraid of losing their jobs and usually don’t complain in public. So why did they do it? Probably because many of them felt they were not being treated fairly.

This isn’t just happening in one company. Income tax data shows that although India’s middle class has grown over the last ten years, their average salaries have barely gone up. A recent study found that people earning between ₹10 lakh and ₹50 lakh a year got only about a 3% rise in average pay between 2012 and 2022. But during those years, the prices of food, fuel, rent, and other things rose much faster. So, even if people earned a little more money, they could actually afford to buy less than before.

For companies, paying low salaries can save money in the short term. But after a while, it creates a bigger problem. If people don’t have enough money, they spend less. That hurts shops, restaurants, factories, and many other businesses.

China is facing this problem today. Its exports are growing fast, but people inside the country are not spending enough. So the economy is growing more slowly than expected. Many Chinese workers feel poorer because salaries have not kept up and house prices have fallen. Some young people who move to cities even share beds to save money because they worry about the future.

India depends even more on people buying things. Last year, more than 60% of India’s economy came from what people spent. If workers feel poorer and start saving every rupee, businesses sell less. When businesses sell less, they stop opening new factories or hiring more workers. That means fewer jobs for young people.

Of course, companies cannot always raise salaries when business is uncertain. Today, many are worried about artificial intelligence, or AI. But some companies are also using AI as a reason to keep salaries low while asking employees to do more work. That may increase profits for a while, but in the long run, it hurts workers, businesses, and the economy.

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