India Inc's projected salary hike for 2025 higher than 2024
What's the story
A recent study by Aon, a global professional services firm, predicts that Indian companies are set to offer an average salary increment of 9.5% in 2025. This forecast is slightly higher than the actual increase of 9.3% observed this year. The study is part of the initial phase of Aon's 30th Annual Salary Increase and Turnover Survey for the fiscal year 2024-25, which analyzed data from over 1,176 firms across more than 40 industries between July and August this year.
Sector-wise increments
Engineering, manufacturing, and retail sectors to see highest hikes
The Aon study also reveals sector-specific salary increment trends for 2025. It forecasts that the engineering and manufacturing sectors, along with the retail industry, are poised to offer a double-digit salary increase exceeding 10%. Financial institutions are not far behind with an expected hike of 9.9%. These projections underscore the strategic importance employers in these sectors place on talent retention amid the current business climate.
Tech trends
Tech sector shows optimism despite cautious start
Despite a cautious start to the year, the technology sector in India is showing signs of optimism as 2025 approaches. Global capability centers and technology products and platforms are anticipating a more optimistic salary hike of 9.9% and 9.3%, respectively. However, technology consulting and services are expected to offer a slightly lower increment at around 8.1%.
Attrition analysis
Attrition rates show downward trend in India
The Aon study also analyzed attrition rates, revealing a downward trend. The average churn rate for this year was recorded at 16.9%, a decrease from the 18.7% reported in 2023 and significantly lower than the 21.4% reported in 2022. This data suggests that companies are becoming more successful at retaining their employees over time.