Salaries in India are projected to rise at 10 per cent next year. This is same as the increase in salary in 2017, according to the 2017 Salary Budget Planning Report released by advisory company Willis Towers Watson. The last increase higher than the current figure was in 2015 when the salaries grew by 10.4 per cent.
What is positive is India's projected salary for 2018 is the highest in the Asia Pacific region. Indonesia is projected at 8.5 per cent, China at 7 per cent, the Philippines at 6 per cent, and Hong Kong and Singapore both at 4 per cent each.
"Indian employees could very well see a single-digit salary increase in 2018 for the first time since 2011... We are also seeing that progressive employers are beginning to leverage employee benefits as a strong lever in differentiating their employee value proposition and ensuring greater transparency in compensation and benefits related communication", said Sambhav Rakyan, Data Services Practice Leader, Asia Pacific at Willis Towers Watson.
Salary allocation for top performers in 2017 increased to 39 per cent up from last year's 38 per cent. On the other hand, the budget set aside for average performance budgets decreased by 1 per cent to 27 per cent.
Arvind Usretay, Director, Rewards, Willis Towers Watson India explained, "Now we see more companies relying on robust processes, governance and training at driving linkages between performance and pay. We expect this trend to gather greater momentum in the next couple of years as companies sharpen their pay for performance policies."
The report highlights that executive salaries have plateaued and in some cases show a downward trend. However, in the mid-management level, the salary increase range is wide - from a 2-3 per cent for average performers to 15 per cent for top performers.
Out of all the sectors, it is energy, FMCG, and retail sectors that will have the most notable projected salary increase is seen in the Survey. At 10.5 per cent, these sectors are expected to do better than the overall projected salary of 10 per cent. This is reflected in the focus on reforms in the renewable energy sector, and convergence in online and offline in the retail sector.
However, significant change is expected in the pharmaceutical sector (from 11 per cent in 2017 to 10.3 per cent projected for 2018). Also, financial services is the only sector where the projected salary is less than the overall projection at 9.1 per cent.
The survey for the 2017 Asia Pacific Salary Budget Planning Report was conducted in July 2017 where 300 companies participated from India and overall 4,000 sets of responses were received in Asia Pacific.