Salaried Employees In India Likely To Get A Higher Median Pay Hike Of 10% In 2023, Reveals Report

Salaried employees are likely to get a relatively bigger pay hike in 2023, with companies budgeting for an overall median increase of 10%, according to the Willis Towers Watson Salary Budget Planning Report. This expectation of a 10% median hike translates to an average salary increase of 9.8% in 2023, compared to the actual 9.5% increase paid out in 2022, an ET report mentioned.

Concerns over tighter labour markets and inflation have influenced the higher projected salary budget, the report reveals.

The financial services, banking, and technology, media and gaming sectors are expected to see the highest salary increases at 10.4%, 10.2% and 10% respectively.

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Report findings indicate that 58% of Indian employers have budgeted for higher salary increase this year compared to last year, while 24.4% are making no changes in the budget. Only 5.4% have reduced the budget as compared to 2022.

Overall, the most cited reasons for organisations reporting higher 2022 actual salary budgets versus projections made last year were concerns over a tighter labour market (68.3%), employee expectations / concerns (44.7%) and anticipation of stronger financial results ¨C actual or forecast (26.4%).

Approximately 42% of companies in India have also projected a positive business revenue outlook for the next 12 months, while only 7.2% have projected a negative outlook.

At 10%, salary increases in India continue to be the highest in the Asia pacific region. China is projected to see an increase of 6%, with Hong Kong at 4.0% and Singapore at 4% next year. Voluntary attrition rates in India continue to be amongst the highest in the region at 15.1%, only second to Hong Kong.

This report summarises the findings of WTW¡¯s bi-annual survey on salary movement and was conducted in April and May 2022. Approximately 22,570 sets of responses were received from companies across 168 countries worldwide. The survey reportedly has 590 participants from India.

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As per the ET report, Rajul Mathur, Consulting Leader India, Work and Rewards, WTW said in a statement: ¡°2022 saw actual salary increments being higher than budgets and this was largely due to better-than-expected business performance and the need to retain talent. Despite the economic headwinds, higher projections for 2023 reflect cautious business optimism and a continued tight labour market¡±.

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