India Inc's average salary hike to be 9.4% this year; up to 16% appraisal for key talent: Survey
As per the survey, companies in India gave an average pay increase of 9.3 percent during 2017, marking a departure from the double digit increments
New Delhi: Employees in India are likely to get an average salary hike of just 9.4 percent this year, same as last year, while key talent are expected to get appraisals of as much as 15.4 percent as companies increase focus on performance.
HR consultancy Aon Hewitt's annual Salary Increase Survey, that analysed data across more than 1,000 companies from over 20 industries, said the average salary for India Inc stands at 9.4 percent this year.
Aon believes average pay increases in India will remain between 9.4-9.6 percent.
As per the survey, companies in India gave an average pay increase of 9.3 percent during 2017, marking a departure from the double digit increments given by organisations since the inception of this study.
Even as salary hike remained at the same level on a year-on-year basis, India continues to lead the Asia-Pacific region.
China is expected to dole out a salary raise of 6.7 percent, Philippines 5.8 percent, Malaysia 5.1 percent, Singapore 4 percent, Australia 3.2 percent and Japan 2.5 percent.
The survey noted that the focus on performance is getting sharper year-on-year. A top performer is getting an average salary hike of 15.4 percent, approximately 1.9 times the pay increase for an average performer.
"With critical skills shortage highlighted as a key concern, companies are becoming more cautious while recognising and remunerating their key talent," Anandorup Ghose, Partner at Aon India Consulting told reporters here.
Ghose further said that "with increasing maturity, HR budgets are being realigned towards top performers as opposed to the broader population".
Sectors such as professional services, consumer internet companies, life sciences, automotive and consumer products continue to project a double-digit salary increase for 2018.
Despite an improvement in macro-economic forecasts - salary increases remain at the same level as was projected in the last fiscal and this is because salary increases are becoming more "nuanced".
"We are increasingly seeing a multitude of factors impacting salary increases such as size of the company, business dynamics within the sub industry, nature of talent requirements and quite obviously, performance," Ghose said.
Meanwhile, attrition rate in India is seeing a continuous downward trend as the overall attrition has come down from an average of 20 percent in the previous decade to 15.9 percent in 2017.