Companies are budgeting a median increase in salary of 10% for 2023 which will translate to an average salary increase of 9.8%, according to the Willis Towers Watson Salary Budget Planning Report.
Salaried employees in India are likely to get a larger pay hike in 2023, with companies budgeting for an overall median increase of 10 percent, according to the Willis Towers Watson (WTW) Salary Budget Planning Report. India Inc will see the median salary hike in 2023 due to labour constraints and inflation concerns.
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The report from the global advisory firm suggests that the median increase could translate to a 9.8 percent hike compared to the actual 9.5 percent increase paid out in 2022. Among the top sectors offering higher increments will be financial services, banking, technology, media and gaming companies.
Revision of budgets with a positive outlook
Corporates in India are revising their budgets with a positive outlook after two years of the Covid-19 pandemic. The report showed that more than half (58 percent) of employers in India have budgeted for higher salary increases this year compared to last year. While only a quarter of employers (24.4 percent) said they made no change in the budget, only 5.4 percent said they have reduced the budget as compared to 2022.
Which sectors are expected to provide the most hikes?
The financial services/banking, technology, media and gaming sectors are expected to see the highest salary increments at 10.4 percent, 10.2 percent, and 10 percent respectively.
As per the report, approximately 42 percent of companies in India have also projected a positive business revenue outlook for the next 12 months. Only 7.2 percent have projected a negative outlook.
At 10 percent, salary increases in India will continue to be the highest in the APAC region. Other countries like China are projected to see an increase of 6 percent, with Hong Kong at 4 percent and Singapore at 4 percent next year. On the other hand, voluntary attrition rates in India also continue to be among the highest in the region at 15.1 percent, only second to Hong Kong.
The report summarises the findings of WTW’s bi-annual survey on salary movement which was conducted in April and May 2022. The survey collected approximately 22,570 sets of responses from companies across 168 countries worldwide while 590 participants of survey were from India.