According to the Aon Annual Salary Increase and Turnover Survey 2025-26 India, India Inc's average salary increase is expected to rise to 9% in 2026, up from 8.9% in 2025, one of the lowest hikes since 2010.

Softer inflation is supporting real wage growth, even as businesses prioritize technology adoption, differentiated rewards, and productivity gains to balance rising costs in the face of economic uncertainty.

Key Highlights

• India Inc expected to grant average 9% salary hike in 2026, per Aon survey.
• Soft inflation supports 4.9% real wage growth even as nominal pay rises tighten.

"With inflation under control, the real rate of wage growth remains at 4.9%. So, in that sense, there is no net loss to employees, even though nominal increases are slowing," said Roopank Panchal, partner, human capital solutions at Aon India. Its annual salary increase survey examines data from 1,060 companies representing more than 45 industries.

Attrition has dropped to a five-year low of 17.1%, while involuntary exits have increased to 4.6%, indicating a greater use of layoffs and performance-based separations as cost-cutting measures. Despite global headwinds and shifting trade dynamics, India is expected to continue its strong growth trajectory.

Also Read: TeamLease Predicts 6.2%-11.3% Salary Hikes Across Industries

Salary increases are expected to be greatest in growth-driven, skill-scarce industries such as automotive, NBFCs, and real estate/infrastructure, while life insurance, banking, and technology consulting are expected to see the smallest increases.

Global disruptions are changing the way companies operate and manage talent. Businesses are shifting from "just-in-time" to "just-in-case" trade models, resulting in more adaptable and resilient workforces that can withstand uncertainty.