Salaries in India are projected to rise 10% in 2020, marginally higher than the actual increase (9.9%) in 2019, according to the latest Q3 2019 Salary Budget Planning Report released by Willis Towers Watson, a leading global advisory, broking and solutions company.
While salary increases in India are stabilising around the 10% mark, they remain the highest in the Asia Pacific region. Indonesia is projected at 8%, China at 6.5%, Philippines at 6%, Hong Kong and Singapore both at 4%, the report stated.
Rajul Mathur, Consulting Leader – Talent & Rewards, Willis Towers Watson India said, "Though salary increases in India still continue to be among the highest in the region, companies are taking a cautious approach and do not intend to make any significant changes from previous years. Companies are beginning to make selective skill-based compensation adjustments to cater to requirements around automation and digitisation."
Of the surveyed companies, 28% have projected a positive business revenue outlook for the next 12 months, down from 37% in 2018. As many as 61% of them expect no big change as compared to 57% last year, and 11% have a downward revenue projection compared to 5% in 2018, according to a Willis Towers Watson release that encapsulated the findings of the report.
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While most sectors like general industry, chemical, high tech and pharmaceuticals can expect salary increases around the average mark of 10%, energy, financial services and consumer products sectors stand out for the highest year-on-year growth.
The energy sector is expected to see a jump from 8.5% in 2019 to 9.3% in 2020, the financial services sector is projected at 9.7% in 2020 from 9% last year and the consumer products sector is expected to see an increase from 9.5% in 2019 to 9.9% in 2020.
Median salary increase at the Executive level for 2020 is projected at 10.1%, a noteworthy increase from 9.6% in the previous year. For middle management, professional and support staff, an increase from 10.1 % in 2019 to 10.4% in 2020 is projected.
The employee group of production manual labour is also projected to receive a higher salary increase of 10.3% as compared to 10% last year.
On salary increases by performance levels, the survey found that on an average, 25% of the salary increase budget is being allocated to top performers, which represents 11.5% of employees in India. This implies that for each INR 1 allocated to an average or below-average performer, INR 2.16 is allocated to a top performer compared to about INR 1.3 last year.