India Inc's projected salary hike for 2024 lower than 2023
What's the story
India's corporate world is expected to offer a 9.5% average salary increase in 2024, slightly lower than the 9.7% raise provided in 2023, as reported by consulting firm Aon. This forecasted raise, the smallest since the 9.3% boost in 2021, is attributed to global economic challenges and a cooling of hiring enthusiasm. The manufacturing sector is expected to offer the most significant raises.
Economic situation
Factors contributing to salary hikes
Aon's report suggests that more money will flow into workers' wallets after these rises, thanks to increased government spending on infrastructure and reduced inflationary pressures. Roopank Chaudhary, partner and chief commercial officer for Talent Solutions at Aon India, said that the anticipated salary growth reflects a strategic adjustment to the changing economic climate.
Sector details
Sector-wise salary increments and attrition rates
The manufacturing sector will likely offer the most significant raises at 10.1%, followed by life sciences and financial institutions at 9.9%, and global capability centers at 9.8%. E-commerce companies and the IT services sector are predicted to provide wage increases of 9.2% and 8.2%, respectively. The survey also observed a decrease in attrition rates from 21.4% in 2022 to 18.7% in 2023, implying that the job market may have reached a stable point.
Leaders' focus
Focus on a supportive work environment
Jang Bahadur Singh, director for Talent Solutions at Aon India, stated that as leaders plan for 2024, their attention will likely shift toward creating a supportive work environment to encourage employee engagement in a dynamic job market. A decline in attrition is beneficial for organizations, allowing them to allocate resources toward improving capability and boosting productivity, thus generating a positive cycle, said Aon India.