Economic Survey 2025: A corporate bonanza of big profits but slow pay
Subscribe to enjoy similar stories. Corporate India is riding a wave of record-breaking profits, but the tide isn’t lifting all boats. The Economic Survey 2024-25 reveals this stark reality.
While companies are raking in their highest earnings in 15 years, wage growth and job creation are lagging far behind, sparking concerns over rising income inequality and its impact on the economy. In 2023-24, corporate profitability soared to its highest level since fiscal year 2008, with the profit-to-GDP ratio hitting 4.8%, more than double the 2.1% recorded in FY23. Sectors like financials, energy, and automobiles led the charge, posting robust earnings.
But while corporate profits surged by a staggering 22.3%, employment grew by a meagre 1.5%, leaving millions of workers out of the prosperity loop. Also Read: What Economic Survey 2024-25 says on 7 challenges facing the government An SBI report further highlights this disparity: while 4,000 listed companies saw modest 6% revenue growth, employee expenses rose only 13%, down from 17% in FY23. This suggests businesses are prioritizing cost-cutting over workforce expansion, with entry-level IT jobs and wage hikes bearing the brunt, the Economic Survey noted.
Despite maintaining a steady Ebitda margin of 22% over the past four years, companies are reluctant to share the wealth with their employees. “While some structural drivers of earnings growth—such as improved productivity and automation—are expected to persist, the heavy reliance on cost-cutting and restrained wage growth may not be a sustainable strategy," said Anirudh Garg, partner and fund manager at Invasset PMS. “The sustainability of profits depends on revenue expansion, and signs of demand moderation in certain sectors
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