Indian Employees Can Get 8% Salary Hike This Year; Companies In These Sectors Can Give Higher Salary Hike
Every disaster comes up with a bright side as well. Every cloud comes up with its own silver lining. Pandemic slowed down the economy. Tons of people lost their jobs and many had to take pay cuts in their existing salaries. As the pandemic is receding, better days might be in the offing.
Paychecks could rise 8% in the next financial year
According to Michael Page and Aon Plc, if the government succeeds in averting the third wave, in the next financial year starting April 2021, paychecks could rise about 8%.
The forecast of an increase in a paycheck is based on the organized labor sector only. Out of the total labor force in India, the organized labor force accounts for less than 20% of the workforce. Much of the Informal sectors are not counted in the surveys.
Various factors are at play
Inflation is primarily considered as the reason for the increase in a paycheck. But after the initial years of the high inflation rate, the last decade was kind of dormant in terms of an increase in the inflation rate. That had led to a sublime increase in paychecks as well. In last year, retail prices have risen but, that is a momentary shock caused by the pandemic induced supply crunch.
Roopank Chaudhary, chief commercial officer for human capital solutions at India and South Asia at Aon, said, the low availability of qualified applicants for the organized sector will also prop up salaries in upcoming months.
He further clarified, “India’s number have always been pushed up not necessarily by GDP or inflation, and there is no perfect correlation there, but largely because of the fact that there is a demand-supply mismatch of talent.”
Even though the economy of India is coming back to normal once again. There are some sectors which are growing at a faster rate than others. Hence the salary hikes will be in line with the reemergence of the sectors only. The e-commerce, pharmaceutical, information technology, and financial services sectors are predicted to offer relatively larger salary hikes in India, while retail, aerospace, hotels, and hospitality will be lagging behind to some extent.