NEW DELHI: Average pay increases in Indian companies will remain at 10% in 2017, unchanged from last year but still the highest among developed and emerging markets in the Asia Pacific, according to the Salary Budget Planning report of Willis Towers Watson to which ET was given exclusive access.
However, in the light of actual salary increments having fallen short of projections in the last two years, Indian employees could well be faced with an average growth that’s below double digits for the first time since 2011, the report said.
“We are seeing lower salary increase budgets across much of the region,” said Sambhav Rakyan, data services practice leader, Asia Pacific, Willis Towers Watson, a global advisory, broking and solutions company. “India will still likely see the highest salary increase in 2017 among the developed and emerging markets in APAC.”
Among sectors, pharmaceuticals and media continue to show high salary increase budgets while financial services and energy industries show a drop. Salary increments in technology companies are likely to stay flat. The trend of differentiated salary increments is set to gain strength.
The data show a greater emphasis on rewarding high performers rather than across-theboard increases for all with companies keeping aside 38% of their salary increment budgets for such employees, who usually comprise 10% of the total.
In terms of distribution of top performers, a larger proportion would tend to be at junior to middle levels with a select few at senior ranks. About 34% of the budget will be set aside for above-average performers and 28% for those regarded as average, which will be the bulk of employees.
“Without such differentiation, companies will face pressure in attracting and retaining talent, especially for in-demand areas,” Rakyan said.
“Employers have to think beyond inflation linking and look at more nuanced factors such as affordability, growth expectations, both employee and company performance, and specific talent and skills needs.”
The survey covered 300 companies across sectors in India and about 10,000 companies globally. Of the respondents, 34% projected a positive business revenue outlook for the next 12 months versus 41% last year. Those who see no big in revenue amounted to 59% of respondents.
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