Total Salary Spends By Startups Increased By 43% Between April-Sept: Report

Total Salary Spends By Startups Increased By 43% Between April-Sept: Report

Around 43% increase in total salary spends by startups in the last 6 months i.e. from April to September 2021, according to RazorpayX Payroll report.


EdTech, FinTech, and Electronics (online and offline) are some of the sectors that witnessed a significant increase in their salary spend during the last six months. Moreover, some startups even increased the median salary of their employees by 7% this year.


The amount paid out on bonuses increased by 23% during the past year as opposed to pay cuts and deferred bonuses last year. Real Estate, Hospitality and AgriTech are some of the sectors that weren't able to give out bonuses yet since they are gradually stabilising.


As businesses start to flourish, hiring has kickstarted again and is expected to only grow in the months to come. At an individual organisational level, 57% of the organisations saw an increase in hiring, and 28% saw a decrease in headcount, in the last six months. The E-commerce sector contributed to this growth in a major way, given that a lot of businesses and consumers started to embrace digital.


The data revealed that mid-level roles grew by 31% while mid-senior level roles saw a growth of 38%. Senior-level roles saw the highest growth of 43% in headcount across startup organisations. This could possibly indicate a need to onboard C-level leaders for rethinking business strategies.


After a drop in the first couple of months, Travel reimbursements increased by 54% in the last one month as work-related travel across startups are starting to increase. Fuel reimbursements increased by 28% in the last 6 months. Further, reimbursements for internet connectivity have increased, possibly indicating continued remote and hybrid work regimes. The number of reimbursements paid in this category grew by 63% during these six months. Interestingly, food reimbursements dropped by 75% in the last six months, after a peak in March.


Shashank Kumar, CTO and Co-Founder, Razorpay said, "Businesses across industries are on the road to recovery and these insights reiterate this in many ways. The fact that the majority of our startups using RazorpayX Payroll have increased their salary spends alongside a steadily growing headcount is a clear sign of revival. While employing the right talent is critical for businesses and especially start-ups, it also means spending man-hours undertaking tedious payroll management processes without leaving any scope for errors. This continues to be one of the most challenging tasks in business finance and it is time that organizations move on from age-old manual processes and instead choose automated solutions so that they can save time, optimise operating costs and focus on business growth and employee experience."


According to a recent industry survey, over 57% of businesses rely on manual efforts for payroll management. Today, organisations of all sizes have been forced to rethink how integrated HRM and payroll software and services could be used to increase efficiency and sustain their payroll practices.


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