Many of the job cuts -- particularly at the top end of the salary scale -- have resulted from corporate restructuring. For instance, PepsiCo India, the soft drinks major, had seven operating regions till last year; now it has only three. Its three large divisions -- Mumbai, Maharashtra and Gujarat -- got rolled into one. Such compacting has led to the exit of two-thirds of its sales heads. Hindustan Lever Ltd (HLL), the Indian avatar of Anglo-Dutch foods giant Unilever is, on the other hand, saddled with about 350 surplus managers, according to one estimate. Acquisition by hll of ice-cream brands like Dollops and Kwality, and the company's merger with Brooke Bond Lipton, led to redundancy of executives at many stages.

However, both PepsiCo and hll are multinational giants with the ability to move their staff globally: if they have become surplus in a particular market at a particular time, they may be valuable elsewhere. Indian companies present a different picture. Ballarpur Industries Limited (BILT), the Thapar Group company, sought to rectify over-diversification and over-staffing in 1995 when McKinsey, the US consultancy firm, went through its businesses with a fine-tooth comb and suggested remedies. P.G. George, chief general manager (corporate management development) of BILT, says that the company's 17 grades between a first-level supervisor and vice-president have been cut down to eight. Such delayering has led to a sudden redundancy of executive staff. From 1,800 managerial staff in 1994, the number has come down to 1,200 now. Debashish Mitra, the group vice-president, is now counselling hundreds of executive staff on how to acquire new skills or find jobs elsewhere. Mitra voices the present do-or-die spirit of corporate India when he says, "The employee who can't add value to the bottom line must be eliminated."

At the other end of the corporate spectrum, in the world of start-up operations and small companies, life in the corporate chambers has lately been nasty, brutish and short. At the private airlines -- eight of them began operations a few years ago but only one has escaped the red ink -- executive jobs have come and gone through the swing door. At ModiLuft, the staff learnt from newspapers the bad tiding that Lufthansa had walked out on the Modis. Pay cheques got delayed. Services were suspended. Pilots who had resigned from Indian Airlines to join the company were sanctimoniously advised to try and crawl back into their old home. Of the 7,500 employees in private airlines, there are only 2,500 left. A former flight steward, who earned Rs 30,000 a month, now does ticketing for a hole-in-the-wall travel agency in Calcutta, at less than Rs 5,000.

The new creed of the hrd professionals is: performance pays. Still, the share of wage in the overall cost of production is on a steady downswing. A recent study shows that it has fallen dramatically from 11 per cent in the mid '80s to 9 per cent in 1990, and 6.8 per cent now. Quite clearly, not all of the drop is due to the efficient use of resources. The private sector is simply using fewer people for the same output.

Most executives are, like the Red Queen in the Alice story, running faster to stay where they are. A large corporate house, known for its liberal executive foreign tours, has moved the sanctioning power from department heads to the managing director's office. Result: a drastic fall in the number of executive nights abroad. A European telecom giant has told new mid-level recruits not to expect more than a 20 per cent annual pay hike, in contrast to the 50 per cent norm earlier. The reimbursements of many executive expenses -- including cellphone use and conveyance -- have now come under closer scrutiny.

But rather than a standstill, or even a rollback in pay and perks, it is the job cut and the negative job growth that hurt the corporate high-rollers of yesterday. The financial sector, which always receives the first blow of an oncoming recession, is of course the worst victim. The mortality rate of merchant banks is running high. Jeydev Parthasarathy, director of Executive Access, an mnc head-hunting agency, feels many businesses, the finance sector in particular, have plateaued off. "You cannot sustain old levels of salary growth." He says the mnc banks are now grabbing executives from Indian banks, often at half the cost. So there is cost-cutting at the entry level itself.

The entry gate is in fact much narrower than in the past. The best offers at the campus melas this year were only 15 per cent higher than last year. This is a sharp drop from the average campus recruitment salary growth of around 30 per cent since 1992. Recruitment of finance mbas in large companies has been cut dramatically, in line with the general squeeze on treasury operations. Ironically, the hrd specialists, generally regarded as a bunch of machiavellian characters who mastermind the firing of employees from the backstage, are themselves facing the music. Many hrd positions have lately been terminated in industries like cement and steel on the ground that these jobs do not create revenue.

However, "elimination" of surplus managers is not quite so easy at all times as job contracts are often rigid in favour of the employee. The corporate solution to this problem, the Voluntary Retirement Scheme (VRS), is something that a deep pocket alone can finance. Whirlpool India, for example, has spent Rs 40 crore since last year to bid farewell to 1,305 surplus employees. The public-sector Coal India Ltd has sought a whopping Rs 600 crore from the Central budget to retire 34,000 staff over the next four years. Coats Viyella India Ltd, the Bangalore-based textiles major, is putting together a VRS fund to shed chunks of its executive and non-executive staff. And public-sector investment bank icici, after its recent merger with SCICI, has offered its 1,250 employees a VRS scheme that will whittle down their number by 13 per cent.

These instances, however, are outnumbered by cases in which VRS funds are either beyond the companies' reach or are considered to be avoidable. "The need to reduce executive strength," says Rao, "often comes as a reaction to bad results." On the other hand, the service sector, which operates on thin reserves, cannot afford to pay out staff. Many television-software companies are now feeling the pinch of falling revenues and high wage bills. So are newspapers, advertising agencies, and travel-related industries. All of them had made the initial mistake of over-recruitment and unreasonably high salary commitments. The consequent bubble, therefore, would have burst anyway. As K. Khandwala of the Indian Institute of Management, Ahmedabad, says, "Companies created an unsustainable growth in managerial remuneration."

The cutting of executive fat is unavoidable, though there is a danger of the knife going too deep. Uday Kotak, vice-chairman of Kotak Mahindra, says while fat is dispensable, "only those who have no future are going in for the bones". The bone is obviously the reserve of human resources that steers a company through the peaks and troughs of business cycles, enriching it with strategic knowledge. Indian business, having gone through a roller-coaster of boom and doom in the past five years, is yet unable to identify its indispensable phalanx. In the process, a generation of the corporate nouveau riche has lost its branded shirts, not to speak of the status -- however ephemeral -- that came with the fat cheques and the swanky cars.

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