Working professionals across sectors might not have much to cheer this year as salary increases likely to see a “marginal” rise compared with last year’s pay hikes in India. According to a study released today by global management consultancy Hay Group, employees across job roles can expect an average of 11.3 percent wage hike in 2015 led by FMCG and chemical industry. Last year, the actual average salary increase was recorded at 10.9 percent across industries, the report noted.
“The study that we have conducted predicts that the pay raise in 2015 will remain in double digits. At this point, the general market can expect the median salary increase and salary hike figure to stay between 10-11 percent,” said Amer Haleem, country manager, Productised Services, Hay Group India, adding that salary increase would be lower at higher levels, with maximum increment at clerical levels, followed by junior management.
The report also highlighted that 60 percent of companies operate a different remuneration policy for graduates as opposed to company‘s standard pay policy. Typical hiring salary for a graduate with a bachelors degree on an average is Rs 350,000, while with a masters degree is Rs 470,000 per annum.
“The outlook is positive and organisations are putting hiring plans in place. In terms of specific sectors, FMCG and chemical industry are expected to lead the market,” said Haleem.
According to the study, “pay-for-performance” trend continues for the Indian corporates, with the payouts widely influenced by both individual and company performance. The actual paid out variable pay stood at 12.7 percent across sectors and levels. The oil and gas sector remained at the top at 15.4 for 2014, followed by FMCG at 14.5 percent and chemicals at 14.4 percent.
The Hay Group Compensation report includes pay insights on 443,756 jobs from 415 organisations, across the sectors of industrial goods, automobiles, technology, oil and gas, FMCGs, chemicals, transportation, retail and others.
Haleem also, pointed out that companies are now choosing to unfollow the ‘one size fits all approach.’ Instead, they are now focusing on ‘bespoke reward strategies’. “Over the past three years, we’ve witnessed how the difference between the rewards offered to average employees vis-a-vis a top performer has been growing sharper,” said Haleem.
According to the study, the top three benefits and allowances provided by participating companies are: car (purchase/lease), death benefits and retirement benefits. (All information in the report is effective as of August 1, 2014. The study does not include compensation practices for CEOs and senior executives in middle to large organizations)