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India Inc has reverted to the pre-pandemic level of salary hikes across industries, a survey released on Tuesday said. As compared to the 8 per cent average hikes in 2021, the salaries rose in the range of 9-9.5 per cent in 2022.
According to consulting firm Mercer's Total Remuneration Survey, the salary hikes in 2023 are also expected to be in the range of 9 to 9.5 per cent. The survey was conducted between May and November last year in 1,300 companies covering 6,065 jobs and over 1.7 million employees.
Mansee Singhal, senior principal and rewards consulting leader at Mercer, said, "The TRS overwhelmingly confirms that organizations across the board continue to revert to pre-pandemic salary increases, which range from 9-9.5 per cent".
Most industries, including manufacturing, consumer and retail, chemicals and automobiles, reverted to pre-pandemic levels of investment in rewards and incentives after a brief dip in 2020.
The salary increases in sectors such as technology, healthcare, services and global capability centres were better than expected, as they were buoyed by tailwinds, such as the accelerated shift towards digitalization, increased demand for healthcare products and services, and subsequent emergence of medical tourism, India's large talent pool and relative cost advantages in light of global geo-political shifts.
The report added that the highest salary hikes are expected in the high-tech industry in 2023, followed by the Software Service Outsourcing industry.
It is also said that the pay mix is also improving in India with more focus on variable pay and incentives at lower posts. However, a noticeable disparity still exists between the higher and the lower-level jobs.
"Higher focus on incentives is paid for the top level and it goes down as we go down in the hierarchy," the report said.
"With global inflation and recessionary headwinds, India Inc. while being broadly insulated, is experiencing layoffs in select sectors. So it is time for cautious optimism, accelerated domain and performance-based differentiation and reviewing of benefits for maximizing returns on investments," Singhal added.
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First Published: Wed, March 01 2023. 14:03 IST
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