According to a new report, amidst global uncertainty and slowing growth, salaries in India are expected to increase by an average of 9.2% in 2025, which is marginally less than the 9.3% increase in the year before.
Despite growing global uncertainty, India is predicted to maintain steady growth, and salary increases will level off in 2025, according to Aon’s Annual Salary Increase and Turnover Survey 2024–25.
Salaries in India To Increase By An Average of 9.2% in 2025
The study discovered that employee attrition in India is steadily decreasing after examining data from more than 1,400 businesses in 45 different industries.
Since 2022, when companies offered an average 10.6% hike as a result of the Great Resignation, salary increments have been declining.
There was a greater talent pool following the Great Resignation, as evidenced by the overall attrition rate falling to 17.7% in 2024 from 18.7% in 2023 and 21.4% in 2022.
According to Aon partner Roopank Chaudhary, the drop in anticipated pay increases is due to outside variables such as US trade policies, Middle East conflicts, geopolitical and economic developments, and the quick development of generative AI.
India’s economic outlook is stable despite these external challenges, Chaudhary added, thanks to stable private consumption and improving rural demand.
Salary Increases To Differ By Industry
Salary increases will differ by industry, with non-banking financial firms expected to see the largest increases at 10% and engineering design services and auto/vehicle manufacturing at the highest rates at 10.2%.
According to Chaudhary, sector-wise trends show a cautious approach to striking a balance between market challenges and talent retention, while companies are experiencing margin pressures that are causing them to moderate salary increases.
He said, “Our data shows that moderation in salaries is an expected outcome given the margin pressures on companies. The sector-wise increment trends for 2025 reflect prudence and adaptability as companies balance market challenges and the need to attract and retain talent across sectors.”
The study emphasizes that in order to achieve sustainable growth, businesses must use AI-driven innovation and take a strategic approach to compensation.
According to Amit Kumar Otwani, associate partner at Aon, India’s economy may be impacted by changing global workforce and business dynamics, so data analysis and cutting-edge technology are crucial for foreseeing and responding to changes.
