The Indian economy grew at an estimated 8.3% over the last financial year. The forecast for 2022/23 currently rests at 8.7%. Experts speculate that this is due to a more positive investment outlook, especially in manufacturing and infrastructure development.
This positive growth story is reflected in the salary increments India Inc may hand out in 2022. According to the 2022 Michael Page Salary Report, employees can see an average hike of 9% versus 7% in 2019, the pre-covid era.
While the past few years have been tough on businesses, the last financial year witnessed the hiring market rebound. Companies are willing to offer top salaries and are competing against one another to attract and hire the best talent once again. The report noted that "while recovery will not be even across all industries, this news should nonetheless bode well for job seekers, especially those who are considering switching sectors with their transferable skills."
Top growth sectors according to the report have been the banking and financial services industry, property and construction, as well as manufacturing. The report added that “senior-level professionals with computer science backgrounds will be in an especially good position to negotiate for some of the highest paying jobs in India, due to the growth of e-commerce and entire sectors undergoing digital transformation.”
Other tech skills dependent portfolios like data scientists (especially those familiar with machine learning), web developers and cloud architects will remain in high demand, commanding a higher average salary than professionals with similar educational qualifications in other job functions.
Commenting on the report, Ankit Agarwala, Managing Director of Michael Page India added that “The hiring market has seen an impressive rebound, with companies competing against one another to attract and hire the best talent. The mega boost is the result of rising attrition, a huge talent shortage, and a dearth of in-demand skills that are predominantly driving the salaries higher. Professionals with niche skills will get higher salary hikes due to a huge dearth of such talent in the market. Remuneration may be important, but it is not everything in talent attraction corporations which will focus on people the first strategy from leadership communication, mental well-being, and flexible opportunities will ultimately win the war of talent.”
While the average rise in salaries is pegged to be around 9%, the report stated that startups and new-age corporations, together with unicorns, are set to lead this trend with an estimated hike of 12%.
In addition to salary hikes to retain top talent, companies are also looking at retaining top performers with a wide variety of compensation options. These include shorter — quarterly or half-yearly —appraisal cycles, promotions, variable pay-outs, stock incentives, retention bonuses, and mid-term increments. The Michael Page report noted that “employers do not expect any further significant impact of the pandemic on the market and are buoyant about future business plans.” This has translated into a positive spending sentiment to retain high-performing individuals and employees with niche skills. The report added that many “can expect above-average increments, in the range of 20-25%. This number could rise further depending on certain cases.