Salaries in India are projected to increase by 9.5 per cent in calendar year 2025, mainly driven by a positive business outlook across several sectors, a survey said on Thursday.
According to global professional services firm Aon plc's '30th Annual Salary Increase and Turnover Survey 2024 and 2025', overall salaries are projected to increase by an average of 9.5 per cent in 2025, compared to an increase of 9.3 per cent in 2024.
Engineering and manufacturing and retail industries are likely to see double-digit salary increases at 10 per cent, followed by financial institutions at 9.9 per cent, indicating the strategic importance employers place on talent in the current economic landscape.
Although the year started on a cautious note for the technology sector, global capability centres and technology products and platforms expect a more optimistic salary increase at 9.9 per cent and 9.3 per cent, respectively, while the technology consulting and services projected increments at a lower end of 8.1 per cent, it added.
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"Despite evolving global economic challenges, our study indicates a positive business outlook across several sectors in India. This sentiment continues in many of the domestically-driven sectors illustrated by the projected increments in the manufacturing, life sciences and retail industries," Aon partner and head of reward solutions in India Roopank Chaudhary said.
The survey further said that organisations showing their commitment for retaining talent in a competitive job market must keep abreast of changing market data and understand the rapidly evolving compensation trends.
Looking at the attrition analysis, a downward trend is apparent with attrition reported at 16.9 per cent on average this year, compared to 18.7 per cent reported in 2023, and 21.4 per cent reported in 2022.
"The softening in attrition provides businesses a unique opportunity to focus on internal growth, capability building and driving long-term productivity. By cultivating and developing talent internally, firms can reduce the necessity for higher costs associated with new hires while simultaneously enhancing their organisation's employee value proposition," Aon associate director for Talent Solutions in India Tarun Sharma added.
This Aon 30th India's Annual Salary Increase and Turnover Study was based on inputs from more than 1,176 organisations across 40 industries.
