Companies In India Anticipate Salary Increase By 9.8% In 2024
The median salary increase in India is forecasted to rise by 9.8 per cent in 2024, close to the actual salary increase of 10 per cent in 2023. That’s according to WTW’s latest Salary Budget Planning Report by global advisory, broking and solutions company WTW’s.
The report looks at a range of job grades across various industry sectors and summaries the findings of WTW’s annual survey on salary movement and reviews HR practices as a means of helping companies with their compensation planning for 2024 and beyond.
Figure 1: Projected and actual salary increase (median) for companies in India
Year | Projected salary increase | Actual salary increase |
2024 | 9.8% | - |
2023 | 9.8% | 10.0% |
2022 | 9.3% | 9.8% |
2021 | 7.0% | 8.5% |
2020 | 10.0% | 7.5% |
Being an emerging market, salary increases in India continue to be the highest across Asia Pacific (APAC). The 2024 salary increase for Vietnam is projected at 8 per cent, followed by China at 6 per cent, Philippines at 5.7 per cent and Thailand at 5 per cent.
Tighter labour markets and rising inflation have been cited as some of the major concerns influencing salary increase budget changes for 2024. However, compared to 2022, more than half of the companies have increased their salary increase budgets this year, while a quarter have increased their budgets from earlier projections in December 2022.
Economic outlook, hiring and attrition rates
The survey also shows that slightly more than one-third (36 per cent) of the companies have projected a positive business revenue outlook for the next 12 months in Q2-2023 compared to 42 per cent in Q22022. In terms of hiring, almost 28 per cent of companies plan to recruit in the next 12 months while about 60 per cent companies have increased headcount in 2023 as compared to the previous year. The report also identifies ‘hot jobs’ for recruitment in the next 12 months, namely roles in Information Technology (61 per cent), Engineering (59.8 per cent), Sales (42.9 per cent), Technical Skills Trade (38.6 per cent), Finance (11.8 per cent), Marketing (10.6 per cent) and Human Resources (3.1 per cent).
Voluntary attrition rate in India has gone down from 15.3 per cent in 2022 to 14.6 per cent in 2023 although it is still one of the highest among the APAC markets.
Sectoral trends in India
Technology, Media and Gaming, Financial Services and Retail sectors are expected to see the highest salary increase at 10 per cent in 2024. Companies in the Financial Services, Retail sectors and Captive setups have projected marginally higher increases for 2024 as compared to the actual salary increase in 2023 due to the continued talent demand.
Rajul Mathur, Consulting Leader, Work and Rewards, WTW India said “Companies across industries are still closely monitoring their cost structures. Within the IT sector, a noticeable correction is expected with salary increments reducing from approximately 11 to 12% in the past to a projected 10% for 2024. In contrast, sectors like Manufacturing, Pharmaceuticals, Media, Gaming, and Global Captive Centers (GCCs) are expanding and this is evident from their hiring plans and salary allocations for 2024. Despite a slowdown in IT recruitment, mid-sized companies, product and platform firms, and the GCCs of Financial Services companies are expected to continue to hire.”
