Higher salaries in India are making a comeback with 9.3 percent hike being expected in 2022, from 8 percent in 2021, and with companies planning to give employees larger raises as they face mounting challenges of attracting and retaining employees, according to a report. Salaries are projected to see a median salary increase of 9.3 percent next year compared to the actual median salary increase of 8 percent in 2021, according to the ‘Salary Budget Planning Report’ by global advisory, broking and solutions company Willis Towers Watson.
India’s projected salary increase is the highest in Asia-Pacific for the next year as optimism returns over improved business outlook in the next 12 months, the report added. The Salary Budget Planning Report is a bi-annual survey conducted online between May and June 2021, with 1,405 companies across sections of industries from 13 markets in Asia-Pacific, including 435 companies in India.
The voluntary attrition rate was 8.9 percent and involuntary attrition rate was 3.3 percent, it added. “Increased business optimism is clearly translating into higher salary budgets and increased hiring activity. The pandemic was a watershed moment in the way organisations plan their people spend,” Willis Towers Watson Consulting Leader India, Talent and Rewards, Rajul Mathur said.
He added that while talent attraction and retention remain a challenge, the core employee value proposition will now need to go beyond just competitive salaries and increasingly focus on a wider range of benefits, wellness, upskilling and the overall employee experience. “This trend is likely to reshape the people spend and total rewards philosophy in India going forward,” Mathur added.
Meanwhile, the report showed that the high-tech sector is expected to see the highest salary increase at 9.9 percent in 2022, followed by the consumer products and retail sector at 9.5 percent and manufacturing at 9.30 percent. In terms of proportionate increase over last year, the high-tech sector again tops with a projection of almost 1.9 percent increase from 2021, it stated.
On the other hand, the energy sector received among the lowest actual salary increase in 2021 at 7.7 percent, the report said. The projected salary of the energy sector in 2022 is also the lowest at 7.9 percent, according to the report.
First Published: IST