NEW DELHI: Professionals can heave a sigh of relief as it might be time to bid goodbye to salary-cuts and freeze in appraisals, with pay rises seeming to be making a comeback. Companies in India, in response to recovery from business challenges caused by the pandemic, are planning on giving employees bigger hikes in 2022.
Salaries are projected to see a median increase of 9.3% next year (translating to an average salary increase of 8.8%) as compared to the actual median salary increase of 8% (average salary increase of 7.4%) in 2021, according to Salary Budget Planning Report released on Wednesday by global advisory, broking and solutions firm Willis Towers Watson.
This optimism emerges from a positive business sentiment among India Inc. According to the report, a majority (52.2%) of companies in India have projected a positive business revenue outlook for the next 12 months, up from 37% in Q4-2020.
The high-tech sector is expected to see the highest salary increase at 9.9% in 2022, followed by the consumer products and retail sector at 9.5%, and manufacturing at 9.30%. On the other hand, the projected salary increase of the energy sector is the lowest at 7.9%.
Commenting on the findings, Rajul Mathur, Consulting Leader India, Talent and Rewards, Willis Towers Watson, said, “Increased business optimism is clearly translating into higher salary budgets and increased hiring activity. The pandemic was a watershed moment in the way organisations plan their people spend. While talent attraction and retention remain a challenge, the core employee value proposition will now need to go beyond just competitive salaries, and increasingly focus on a wider range of benefits, wellness, upskilling and the overall employee experience.”
Most start-ups increased their salary spends this year alongside a growing headcount, indicating further hikes, promotions and hires, according to RazorpayX Payroll Insights. Total salary spends increased by 43% during the period, with EdTech, FinTech, and Electronics sectors witnessing a significant pay rise. Some start-ups even increased the median salary of their employees by 7% this year.
