 "Salary hike, Salary, Rupee")
As most workplaces are in the midst of the appraisal season, a talent company has told Business Standard that the average corporate salary increment in India was expected to be somewhere in the range of eight to 11 per cent across levels this year.
According to Randstad India, junior professionals, with a work experience of 0 to 5 years, are likely to outshine seniors. They are expected to get the highest increment in the range of 10 to 11 per cent. But some may attribute it to the higher base effect, as salaries of the senior professionals are higher.
The demand for freshers and junior professionals is uniformly high across Tier 1 and Tier 2 cities in India.
“It is important to acknowledge that monetary compensation is gradually becoming more and more skill and outcome-based, the reason why professionals with highly specialised and niche skill sets will command more flexibility when it comes to salary negotiations,” said Viswanath PS, managing director and chief executive officer at Randstad India.
He said that the companies are increasingly adopting the strategy of hiring freshers and junior-level candidates and skilling them according to the organisation’s needs and it has worked well across industries and locations.
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For senior professionals, with a work experience of over 15 years, the average salary hikes are likely to be the least among all levels, in the range of 8-9 per cent. The medium-level professionals are likely to see an average increment of 9-10 per cent.
Among the sectors, the highest increments are likely to be in internet/e-commerce, manufacturing and banking, financial services and insurance (BFSI) companies. They may witness an average hike in the range of 10-12 per cent this year.
Randstad India said that the e-commerce industry has become a more value-added model, increasing the demand for middle and senior-level managers who can drive growth.
In manufacturing, the salary hikes can be attributed to advancements in technology, rising demand for skilled individuals, and emphasis on innovation, research as well as automation.
In the BFSI sector too, there is a higher demand for skilled workforce.
However, information technology and information technology-enabled services (IT/ITeS) may witness the lowest salary hikes in the range of 7 to 9 per cent owing to global headwinds.
Viswanath said that this sector will most likely have a recovery in the second half of the year, setting up a strong foundation for better salary hikes in the next cycle.
Attrition may recover to pre-pandemic level in the next 12-18 months
The talent firm also said that in 2024, the attrition is likely to be in the range of 13-14 per cent, lower than in the pandemic years. In 2022 and 2023, the attrition was in the range of 18-20 per cent.
However, it would continue to stay higher than 11-12 per cent in 2020. It is likely to fall below the pre-pandemic level in the next 12-18 months.
“Companies across sectors are making heavy investments to retain top talent and combat the existing supply gap, especially for niche skills,” said Viswanath.
He added that the professionals are being very selective about the kind of companies they want to work for and due to this, employers are deploying various retention strategies.
These are driven by a mix of fair compensation, learning & development opportunities, and healthy work-life balance.
“Going forward, as the overall job market attains more stability over the next 12-18 months, attrition rates will likely reduce to pre-pandemic levels,” he said.
Money matter
Highest salary hikes: Internet/ e-commerce, manufacturing, and BFSI
Lowest salary hikes: IT/ITeS
13-14% to be lowest since 2022
Junior-level professionals are likely to see the highest salary hike percentage
