Pay hikes in India are likely to rebound to the pre-Covid-19 levels in this financial year as the pandemic eases and the economy recovers, according to the latest annual salary increase survey conducted by professional services firm Aon in the country.Average pay hikes are likely to increase to 9.4% in 2021-22 from 8.8% in the previous year, it found, while startup employees are in for a bonanza as the average hikes of 16.9% are likely to be the highest among sectors.The projection means that the overall salary hikes for India Inc are moving towards the pre-pandemic level of 9.3% in 2018-19, which had dropped sharply to 6.1% in 2019-20.The survey, covering 1,350 companies across 39 sectors, found that startups are way ahead of the curve as more success stories, especially in 2020 and 2021, are helping them attract more funds, resulting in a greater need to build and retain talent pool at the same time. 86019695“With many startups turning into unicorns and some even going for successful IPOs (initial public offerings), investor confidence in startups is at an all-time high. Many startups in the tech space are seeing a big spurt in hiring. As a result, the war for talent is intensifying,” Roopank Chaudhary, partner in Aon’s human capital business told ET.According to the survey findings, across sectors, top talent including senior executives, who got negligible or no hikes in 2020, have received better hikes this year, and the trend is likely to improve further in 2022. Indian businesses are making a hockey stick shaped recovery, said Chaudhary, adding that given the buoyancy, swift recovery, pent-up demand and aggressive vaccination drive, average pay hikes are inching up.Sectors such as hi-tech, IT, ecommerce and professional services, are likely to see the highest increments of more than 10% in 2022. While sectors including cement, energy (oil, gas, coal and power), engineering design services are likely to pay the lowest hikes of 7.7-7.8%. The war for talent across sectors has taken the attrition rate to 20%, highest in a decade, revealed the survey. Attrition rate across startups is even higher at 23.8%, it said. “High double-digit attrition is the strongest we have seen in more than a decade. The war for talent is back in India, which we anticipate will keep salary increases high. The question for corporate India is — will this level of increase be sustainable in the long run?” said Nitin Sethi, CEO of Aon’s performance and rewards businesses in India. The survey pointed to the convergence of salary hikes across sectors, with more companies giving increments around the average pay hike of 8.8% this year. “Even for 2022, we are seeing more sectors giving hikes coming closer to the average of 9.4%. The variation in pay hikes across sectors is reducing,” said Chaudhary.About 61.9% of the companies surveyed said they expected an improvement in business in this financial year, up from 45.4% companies last year. At the same time, the number of companies seeing a decline in business outlook reduced to 11.5% from 31.7% last time.
from Economic Times https://ift.tt/2WW1kM5
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