When compared to 9.7 percent in 2023 amid cooling attrition and global demand-dependent sectors such as technology facing headwinds, India Inc is projected to hand out a lower average annual salary hike of 9.5% in 2024. This is noted as per the Aon’s Annual Salary Increase and Turnover Survey which was unveiled on Wednesday.
India is still the leader among APAC nations with a 9.5 percent hike. Apart from that, finer data shows salary increase adjusted for inflation has risen to a healthy 5 percent which was lower than last year. Furthermore, this number also showcases a return to the levels which was witnessed in the pre-pandemic years of 2018 and 2019.
A major chunk of companies is expected to award their employees a 9-12% hike while there is a strong variation across companies in India this year.
Also, if we look as per the sectors, with 10.1 percent hike, manufacturing shines the brightest with its projection. While on the other hand, financial institutions (9.9%), Global Capability Centres (9.8%), Chemical (9.7%) and Professional Services (9.7%) are also expected to give out healthy hikes.
On the other hand, Technology Platform and Products (9.5%) and Technology Consulting and Services (8.2%) come in lower. While the global recession is impacting IT and financial services, the manufacturing industry is witnessing salary levels going up or staying flat.
The junior management is set to take home the highest hikes of 9.9% like last year, while middle management and top & senior management close in at 9.4% and 9.1%, respectively. Having said that, the top management also get compensated in other cash and non-cash options.
“The projected increase in salaries in the Indian formal sector indicates a strategic adjustment in response to the evolving economic landscape. Despite a conservative global sentiment, industries such as infrastructure and manufacturing continue to project robust growth, indicating the need for targeted investments in certain sectors,” stated Roopank Chaudhary, Partner and Chief Commercial Officer at Talent Solutions at Aon (India).
While the Jang Bahadur Singh, Director at Talent Solutions at Aon (India) assters, “In 2023, organizations’ navigated a challenging environment, balancing a generous average salary increment amidst high attrition rates. As leaders prepare for 2024, their focus is likely to shift towards building a supportive work environment to foster employee engagement in a dynamic job market.”
