Consider the following statements based on the news report on mid-term pay hikes in Indian companies:
(A) Intense competition and rising attrition levels are forcing companies to hand out mid-term salary hikes.
(B) India Inc. is trying to hold back talent, especially in the manufacturing sector.
(C) A massive recruitment spree in sunrise sectors like BPO, telecom and retail has led to a demand-supply mismatch.
(D) The mid-term hikes are being offered in place of the salary hikes handed out during annual appraisals.
(E) Companies are identifying people who may be tempted to leave and are devising ways of retaining them.
Which of the statements given above are correct?
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (A), (C) and (E) only
(A) Intense competition and rising attrition levels are forcing companies to hand out mid-term salary hikes. — Correct. Attrition means employees leaving. As more people leave and firms compete for them, companies give mid-term hikes to keep their staff.
(B) India Inc. is trying to hold back talent, especially in the manufacturing sector. — Incorrect. The talent being held back is especially in telecom, IT, BPO and retail. In manufacturing, the talent exodus is lower, at 8-12%.
(C) A massive recruitment spree in sunrise sectors like BPO, telecom and retail has led to a demand-supply mismatch. — Correct. Heavy hiring in these fast-growing sectors means demand for people is more than the supply.
(D) The mid-term hikes are being offered in place of the salary hikes handed out during annual appraisals. — Incorrect. The mid-term hikes are over and above the annual-appraisal hikes. Employees get both.
(E) Companies are identifying people who may be tempted to leave and are devising ways of retaining them. — Correct. Firms spot those likely to leave and give them reasons to stay, such as learning and development facilities.
NCERT (2026-27 Edition):
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