Our salaries shrank from FY16-24. But here's what didn't.

Summary: From FY08 to FY16, employees of India’s top 50 companies were keeping up with inflation. But from FY16 to FY24, they fell behind. Here’s what that means for your real income, and how you can stay ahead.

Between FY08 and FY16, life wasn’t exactly rosy. The global financial crisis had rocked economies, hiring slowed, and the job market was shaky. But if you were employed by a Nifty 50 company, there was at least one silver lining: your salary, though modest, was growing faster than inflation.

That meant you were inching ahead, saving a little more each year, building a cushion, possibly investing a bit. Salaries were still a viable tool for financial progress.

But post-2016, something changed. A Marcellus Investment Managers analysis of Nifty 50 companies reveals that average employee salary growth between FY16 and FY24 has failed to keep pace with even basic cost-of-living inflation, let alone allow for long-term savings. If your only financial strategy was to rely on salary hikes to stay ahead, you may actually be falling behind in real terms.

The numbers say it all

The report ‘White collar jobs growth and wage growth: Twin drivers of India’s slowdown’ examined the salary patterns of the same set of Nifty 50 companies across two different periods: from FY08 to FY16 and FY16 to FY24. In the first period, average salary growth beat inflation by 1 per cent in real terms. In the second, the average salary shrank 3 per cent annually, as inflation pulled ahead. Put simply, our salaries have shrunk in real terms.

So, while your CTC might have gone up on paper, this is a crucial wake-up call: you cannot depend on salary hikes alone to build wealth.

SIPs kept running, and winning

As salaries were losing the race to inflation, Systematic Investment Plans (SIPs) were quietly winning it.

What if you had started a SIP of just Rs 10,000 per month in a diversified equity mutual fund back in FY2016?

Even an investment in a plain-vanilla Nifty 50 index fund would have grown at an annualised rate of 12.5 per cent, much higher than the inflation of 5 per cent at the time.

So, here’s the hard truth: your salary alone is no longer enough to drive financial progress. If you're not investing, you're not just standing still, you’re quietly falling behind.

The big takeaway?

Don’t rely solely on your job to create financial progress.

Inflation is a relentless opponent. If your salary can’t beat it, your investments must. SIPs offer a consistent and proven method to grow your money faster than prices rise.

Most people work hard for their money. But what if your money could work harder for you?
Start an SIP in a mutual fund today and ensure your wealth isn’t tied to your boss’s appraisal cycle.

To know which mutual funds to invest in, discover our recommended funds on Value Research Fund Advisor.

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Also read: Inflation is making you poorer. Here's how you can fight back

This article was originally published on August 07, 2025.