Salary story gets better

India to top Mercer's projected hikes for 2006.

Salaries in India are projected to rise more than anywhere in the world next year ""7.3 percentage points above inflation""according to a survey by Mercer Human Resource Consulting, an employee benefits consultancy and services provider.

Last month, Hewitt Associates, another human resources firm, had projected India as the runaway leader across the Asia-Pacific region in rewarding its workforce next year with an average increase of 14 per cent in salaries.

In the Mercer survey, the next highest increases are projected in Egypt and Lithuania, where employees are expected to receive pay rises of 7.1 and 5.5 per centage points above inflation, respectively.

The average pay in seven of the 10 (69 per cent) countries covered, including the UK and the US, is predicted to increase by between 1 and 3.5 percentage points above inflation.

Globally, salary increases are expected to be higher next year than they have been in 2005, according to the survey. The average pay rise is expected to be 2.4 percentage points above inflation, compared with 1.9 percentage points this year.

The study also found that some countries would experience rises that would be over double the global average.

Greg Cornish, global head of Human Capital Advisory Services at Mercer, said, "We have seen strong global economic growth in the past couple of years and all the signs indicate that this is to continue in 2006. With this growth and more stable inflation, we anticipate next year's pay rises to be higher, in real terms, than this year's."

Mercer's Global Compensation Planning Report examines employment and pay trends in 70 countries. Data on projected pay are taken from a survey of multinational companies and inflation data from the International Monetary Fund and the Organisation for Economic Co-operation and Development.