Despite most Indian companies failing to show substantial improvement in earnings for the quarter ended September 30, 2015, the salary and employment outlook for the country remains strong. According to the ‘2015/16 India Salary and Employment Outlook’, released by international recruitment consultancy Michael Page, 76 percent of respondents who took part in a survey expected to increase their headcount over the next 12 months. Furthermore, 99 percent of the companies said their employees will receive a salary hike over the same period.
The survey was conducted among 240 employers ranging from large multinational companies to small and medium enterprises across all major industries.
The robust outlook for hiring and wage increases for employees of Indian companies at this juncture appears more to be a strategy of being ready with the requisite talented workforce when growth and demand in the economy actually picks up (as it is widely anticipated to), rather than a consequence of immediate revival in economic growth.
Employees working with Indian companies can take heart from the fact that 62 percent of the respondents indicated that they would be doling out salary hikes in the range of 10-15 percent over the next one year. Another 11 percent stated they would be handing out increments in the range of 16 to 20 percent.
The study also indicated a strong co-relation between performance and rewards at Indian firms with 86 percent of companies surveyed stating that they will be offering bonuses to their direct employees. Around 49 percent of the respondents said the bonus they would be awarding to employees could range between 10 and 15 percent of their total salary.
In its overview, the Michael Page report observes that a large part of the confidence in future salary and employment outlook is being driven by emerging sectors like ecommerce. India’s ecommerce sector has been rapidly growing in terms of the quantum of merchandise sold and the number of players entering the fray, armed with copious amount of investment from private equity and venture capital funds. While revenues of these online commerce firms have been growing, most of them remain loss-making.
“As a result, we are seeing the diversion of talent to ecommerce from other sectors such as FMCG (fast moving consumer goods) and FMCD (fast moving consumer durables),” the report observed.
Health care and infrastructure are the other two sectors that are expected to see a lot of hiring activity going forward, according to the report.
Commenting on some of the current trends seen in the way companies have been attracting and retaining talent, the report says firms are making a large number of counter offers to employees who are considering external offers.
“One of the most interesting shifts we are observing is the move towards aptitude-based hiring. Where traditional workplaces have given preference to experience and length of service when considering candidates, we are seeing more and more calls for hiring managers to evaluate candidates purely on merit and abilities, regardless of how their experience stacks up,” the report also said.