A survey says that in 2023 India Inc is likely to see an average salary increment of 9.8 per cent. This is just slightly higher than 9.4 per cent hike in 2022. Notably, for the top talent the increase will be much more.
As per the India Compensation Survey by Korn Ferry, it is through various talent management initiatives and formal retention and compensation plans that the organizations are focused on to retain the critical, key talent.
An Average Salary Increment of 9.8% in 2023
As many as 818 organizations were covered in the survey with more than 800,000 incumbents noted that salaries are set to increase by 9.8 per cent in India in 2023.
In the pandemic-hit 2020, the increment was significantly down at 6.8 per cent.
However, the current growth trend reflects the resilience and ability of leaders and employees to reimagine and rebuild for a sustainable future.
In alignment with India’s focus on accelerated digital capability building, the survey has projected substantial increments in life sciences & healthcare and high technology sectors at 10.2 per cent and 10.4 per cent, respectively.
Silver Lining For Indian Economy Despite the Global Slowdown
The Chairman and Regional Managing Director of Korn Ferry, Navnit Singh said that “Although recession and economic slowdown are being discussed across the globe, there is optimism about the Indian economy with a projected GDP growth of 6 per cent upwards”.
He also said that for top talent, the salary increment can be anything as high as 15 per cent to 30 per cent.
Salary increase projections for some of the other sectors include services (9.8 per cent), automotive (9 per cent), chemical (9.6 per cent), consumer goods (9.8 per cent) and retail (9 per cent).
Despite the overall positive macroeconomic outlook, new and increasing pressures like changing customer preferences, digital transformation, increased collaboration are forces to reckon with.
He said that to stay ahead, most businesses will need to transform their workforce to meet these demands.
Further, 60 per cent of the organizations in the survey indicated that they have adopted a kind of hybrid model.
Also, when it comes to various cities and their respective compensation. The employees of Tier 1 cities continue to receive higher compensation than the Tier 2 and Tier 3 cities.
However, with the hybrid model and remote work developing into an accepted norm, “we are seeing a shift towards work becoming location agnostic, aiding Tier 2 cities such as Ahmedabad and Pune in giving competition to Tier 1 cities in Fixed Annual Cash received by employees”, it said.