'India likely to see 10.3% salary hike in 2013'

Reflecting a cautious outlook and growth expectation of 5 per cent for this year, India Inc projected an average salary increase of 10.3 per cent for 2013, an Aon Hewitt study revealed on Wednesday.

The study shows a wide variance of salary increases across sectors. Financial services, Technology,Outsourcing have seen the greatest volatility and remain cautious in 2013.

Consumer & Industrial sectors which so far have been resilient, also reported conservative increase projections.

Sandeep Chaudhary, Partner (Talent & Rewards) at Aon Hewitt India said, “In sync with the economic outlook, 10.3 per cent increase is among the lowest the country has seen in a decade (barring the subprime crisis year). Though business sentiment is strengthening on account of inflation reaching a three-year low and stock markets rising upwards, the cautious streak is evident in the projected salary increase numbers”.

The study noted that in recent years there is a shift in the way increments are managed in organisations. With shrinking salary budgets, organisations are creating sharp differentiation in salary increases between their key talent and the rest of the population.

Chaudhary added, “Cost consciousness and performance orientation are the key themes this year.

Organisations are looking at compensation and productivity together and hence closely evaluating the return on compensation spent”.

Despite a year in which India’s growth came to a decade low, corporate India reported an average overall attrition of 19.3 per cent for 2012. With a growing recognition that key talent is a sustainable competitive advantage, organisations are reshaping their strategies to safeguard this talent group, the survey pointed out.

Overall India=10.3%    2013
Life Sciences    13.1
Consumer    11.8
Engineering Design    11.5
Automobile    11.0
Hi-Tech    10.5
Hotels    10.4
IT Enabled Services    10.1
Energy    10.1
Retail    9.8
Financial Institutions    8.0
Infrastructure    6.1