Are double-digit average salary hikes a thing of the past? A recent salary growth survey suggested that such average hikes may not return anytime soon, though high performers may continue to get rewarded. It said the average salaries in the world's fastest-growing economy are projected to inch up to 9.7% in 2019, making it the biggest salary hike in three years on expectations that economic growth in India will accelerate. It's way below the salary hikes reported in 2011, the fastest in the past decade.
What's heartening is the fact that it's steadily moving up since 2017 when the demonetization in November 2016 and the implementation of the goods and services tax (GST) in the following year hurt the average hike and pushed it down.
The overall slowdown of average pay hikes squarely blames on the performance-based incentives and more differential pay structure based on employee performance. Some sectors such as consumer internet, consumer products, professional services, life sciences and automotive are likely to reward their employees with a double-digit increment in 2019.
While the advent of automation and slower hiring growth in sectors such as e-commerce, internet and retail pushed down the employee turnover rate, layoffs have seen a steady rise. These factors have definitely influenced salary hikes.