Pay hikes at Indian companies are expected to drop to 9.5 per cent on average across industries this year compared to last year's average increases of 10.3 per cent, according to the latest salary survey by HR consultancy Aon Hewitt. However, certain industry sectors will continue to command double digit increases.
Consumer Internet companies including the likes of e-commerce majors are expected to give a 12.4 per cent pay raise, while life sciences and professional services (including law firms, consultancies and accounting firms), will see a 11.3 per cent and 10.9 per cent increase respectively.
The study analysed data from over 1,000 companies ranging from mid-to large-sized organisations. Here's how different industry sectors ranked:
Digitally-focused jobs, product development roles, and R&D life sciences skills will continue to be the mos sought after skills in the coming year, said Anandorup Ghose, partner at Aon Hewitt India.
According to Ghose, while recent macro-economic and political events such as Brexit, demonetisation in India, and the change in the US government have caused some uncertainty among employers, Indian companies have seen the larger trend of pushing back on high pay increases after a period of steep hikes. Many companies saw "compensation costs increase faster than their revenue and profitability," putting strain on pay increases, he said.
Automation is also a big discussion topic among employers but the impact on jobs in Índia won't be dramatic, Ghose said, adding that overall, wages continue to be low in India, making hiring people more cost efficient over robots in many sectors.
Other highlights from the Aon study include:
- While historically, inflation hasn't affected pay increases, companies may use the significant drop in consumer inflation over the past few quarters as an opportunity to further manage their compensation budgets.
- Companies will continue to compensate handsomely their "high perfomers," which make up 7.5 per cent of all employees, the lowest recorded number in the 21 history of the survey.
- Attrition rate in India remains flat from last 2015 at 16.4 per cent, but attrition among key performers increased from 7.3 per cent in 2015 to 12.3 per cent in 2016. Unequal pay along with stagnation in the roles and limited growth opportunities, were cites among the top reasons for employees leaving the company.