Jun 2, 2008

Indian salaries set to rise again



From Business Standard. Of course, the increase would fluctuate between organizations and industries.

Talent crunch and rapid growth in many sectors has ensured that private sector employees in India have received or can look forward to an average salary increase of 15 per cent this year. The double digit hike has come despite the slowdown and turmoil in financial markets. The increment is roughly the same as the last year but not significant in real terms because of the inflation rate, which is ruling at 8 per cent. Still, India is far ahead of other markets, for instance the average hike was 5.5 per cent in the US and 8 per cent in China. While companies are growing at a fast pace, there is not enough talent in the market to fill the demand.

Thus, companies are resorting to significant pay hikes to retain people. According to executive search firm EMA Partners International, average increases will be 7 to15 per cent while top performers will still get 25 to 30 per cent. HR firm Hewitt Associates estimates average salaries in India rose 15.2 across sectors for 2008-09. Unlike in developed countries, where the increases are linked to inflation, in India salary increases are generally driven by the demand-supply scenario.
If you are an employer/HR manager do you agree with these projections?

How about if you are employees? How much hike have you got? How much are you expecting?