The Aon Salary Increase Survey has found that 87 percent of surveyed companies have reported that they intend to pay out salary increases in 2021. Of these, 61 percent of these organizations are projected to offer a hike between five percent and ten percent.
This compares to 71 percent of companies providing increases in 2020, when, of that group, only 45 percent gave increases in the same range.
The study analyzed data across 1050 companies from more than 20 industries.
Nitin Sethi, a partner at Aon, and CEO of the firm’s Performance and Rewards Solutions practice in India said that despite the gravity of the COVID-19 pandemic in India and its deep impact on the economy, organizations in India have shown tremendous resilience and a mature view on talent.
"Business and HR leaders made hard decisions in the second and third quarters of 2020 and are now betting on the green shoots of improving consumer demand. They see the need to invest in talent as a critical part of their recovery and growth prospects," he added.
The industries looking to provide the highest salary increases are high technology (Hi-Tech), information technology (IT), IT Enabled Services (ITeS), life sciences, e-commerce, chemicals, and professional services.
Meanwhile, companies in the hospitality, retail, and real estate/infrastructure industries, which had given very low increases in 2020 are projecting a higher increase for 2021, but still trail most other sectors.
The study also said that two-third of the companies either aim to provide similar or higher increments in 2021 compared to the increments offered in 2020. It also said that there will be location-based differential pay among companies.
Navneet Rattan, Director at Aon in India’s Performance and Rewards Solutions practice explained that the impact of COVID-19 has been varied in different sectors and organizations.
He added that there are high differentials in salary increases, both intra and inter-industry. Here, the difference between industries with the highest increase to lowest increase hits 7.2 percent points as compared to mere 2.4 percent points in 2019.