AonHewittAPACHRO News OIndustry Insight

India employers continue with 10% salary increase in 2014 lowest in a decade

Anandorup Ghose, Rewards Consulting Practice Leader at Aon Hewitt India, commented: “This period reflects the easing off of the unsustainable turbo-charged pre-crisis economic growth. Even though growth appears to be strengthening in both advanced and developing economies, it is expected to be muted and slower paced than in the pre-2008 era. This sentiment is reflected in India’s slightly higher salary increase projections for 2014.”

Sectors largely reliant on the domestic economy such as Pharmaceuticals, Chemicals, Engineering Services and Consumer Goods, are projecting the highest salary increases, typically above 10% for 2013-14. In these industries, compensation costs represent a smaller percentage of the total cost structure. However, the cautious streak is evident as projections for 2014 have reduced by an average of 30 basis points from the actual increases provided in 2013 by these industries.

Service industries like Retail, Financial Services, and Hospitality bring up the rear in salary increase projections, with these businesses impacted by the slowing down of the economy and consumer spending. In these industries, compensation costs are a significant portion of their total cost structure, thus managing salary costs has become an important element in their cost management strategy.

It is important to note that the dispersion between the highest paying and the lowest paying industries has narrowed in 2014 to about 2–3%, as compared to the 5–7% dispersion observed in 2013….Read More

One thought on “India employers continue with 10% salary increase in 2014 lowest in a decade

Leave a Reply