India likely to see double digit pay rises in 2023

Indian employers are likely to raise staff pay by 10.4per cent next year, almost on par with the 10.6per cent so far in 2022, Aon PLC (AON.N) said on Monday.

The prospects of a double-digit salary increase comes as the south Asian country grapples with soaring inflation amid fears of a global economic slowdown. India’s inflation rose to 7per cent in August and has stayed above the central bank’s tolerance level for eight straight months to August.

“This (salary) increase is a reflection of the confidence that corporate India has on its strong business performance,” Roopank Chaudhary, partner, human capital solutions at Aon in India, said in a statement, based on a survey.

The survey analysed data from 1,300 companies across more than 40 industries. Business leaders, however, need to balance the impact of rising costs and salary pressures with a relatively high rate of attrition and the ongoing demand for critical talent, Chaudhary said.

Staff exits in the first six months of this year remained high at 20.3per cent, but marginally lower than the 21per cent in 2021, the survey showed.

E-commerce leads sectors with the highest projected salary increase of 12.8per cent, followed by start-ups at 12.7per cent, hi-tech/information technology and IT-enabled services at 11.3per cent and financial institutions at 10.7per cent.