The increments are expected to be higher across all major sectors, compared with 2021 and the pre-pandemic levels observed in 2019.
Around 9-10% average increment in salaries is getting well established for employees in 2022, as increasing number of human resource consultants are pegging hikes this year in that range.
Deloitte Touche Tohmatsu India LLP, on Wednesday said that average India 2022 increment is expected to go up to 9.1% from 8% in 2021.The 2022 projected increment is higher than the pre-COVID-19 increment in 2019 by 50 basis points. The findings are part of phase-1 of the 2022 ‘Workforce and Increment Trends’ survey.
In February, Aon Plc had revised its salary increment trend to 9.9% versus an average of 9.4% forecasted by it earlier in September 2021. Mercer has projected an increase of 9% in salaries across industries in 2022. Willis Towers Watson survey on salary trends published in October had projected a median increase of 9.3% in salaries in 2022, as against an increase of 8.1% in 2021.
In another piece of good news, the universe of organisations looking to give increments in 2022 has also expanded further, with almost all organisations now planning to give increments in the coming year, which was restricted to 92% in in 2021 and only 60% in 2020, Deloitte survey finds. According to the the survey results, in 2022, 34% organisations are planning to give double-digit average increments, compared with only 20% in 2021 and 12% in 2020. Employees at junior management are, on an average, expected to receive a double-digit increment in 2022.
The increments are expected to be higher across all major sectors, compared with 2021 and the pre-pandemic levels observed in 2019. Life sciences and IT sectors are likely to give the highest increments in 2022. FinTech, IT-product companies, and digital/e-commerce organisations are expected to give double digit increments in 2022.
Anandorup Ghose, partner at DTTILLP, said, “Corporate India reacted differently to each COVID-19 wave. In 2020, the pandemic pulled the economy in a recession and lower increments, pay-cuts, and hiring freeze were common. In 2021, increments were higher, pay-cuts were reversed, and COVID-19-specific benefits were introduced. However, in 2022, in line with the pick-up in activity, as well as hiring and attrition, companies have surpassed pre-pandemic levels of increments, with a sharp focus on retention of talent through rewards.”
The survey further highlighted that while the increment of 9.1% is only for existing employees, the overall employee cost could go up by an even higher amount, owing to factors such as incremental hiring, one-time pay corrections, and retention bonuses. Anubhav Gupta, Partner at DTTILLP, said, “Increments are currently being driven, predominantly by the local labour market conditions. Where increments go from here on will be a function of economic viability and fundamental business growth over the medium to long term.”
However, attrition continues to be on the rise. Pan India, the average attrition has increased from 15.8% in 2020 to 19.7% in 2021, with voluntary attrition going up by more than 5% between 2020 and 2021.
