Salary increments in India to hit 5 yr high of 9.9% in 2022: Aon

NEW DELHI: Salary increments in India will touch a five-year high of 9.9% in 2022 as organisations are planning to invest in new-age capabilities to build a resilient workforce amid strong economic recovery and positive business sentiment, a survey said on Wednesday.

According to leading global professional services firm Aon’s 26th Salary Increase Survey in India, organizations across industries project a 9.9% salary increase in 2022, compared to 9.3% in 2021.

The study that analysed data across 1,500 companies from over 40 industries, noted that the industries with the highest projected salary increases are e-commerce and venture capital, hitech/IT and IT enabled services (ITeS) and life sciences.

Survey participants reported the highest attrition figure – 21% - in over a decade in 2021, the report said, adding that highest attrition in over two decades signifies the impact of ‘Great Resignation’ on India.

“Salary increases should come as a welcome break for employees amidst a volatile period. For employers, it could emerge as a double-edged sword when you combine the rising cost of talent with record-high attrition numbers,” Nitin Sethi, partner and CEO of Aon’s Human Capital Solutions in India said.

Sethi further noted that “this trend is fuelled by economic recovery and the need for organisations to invest in new age capabilities to build a resilient workforce.”

According to the survey, a positive business outlook is resulting in a higher number of double-digit increments.

Around 88% organizations foresee an improvement in business outlook in 2022, 11% higher from 2021, the survey said, adding that at least 33% organisations are expected to give double-digit salary increases to employees in 2022 -- an increase of 5 percentage points from the previous year.