Salary hikes to drop to 9.1% in ’23: Deloitte

This is a result of economic uncertainties, high-interest rates, and persistent inflation, resulting in increased caution among organizations

March 30, 2023

Life sciences and manufacturing industries are predicted to have the highest increments at 9.5%

The overall Information Technology (IT) sector—including products and services—is expected to witness the sharpest decline to 9.1% from 10.3% in 2022

Salary hikes in banking, financial services and insurance (BFSI) are expected to be at 8.6%

Increments in consumer products stand at 9%, and services at 8.8%

The average increments for India Inc are expected to decrease from 9.4% in 2022 to 9.1% in 2023 due to economic uncertainties, high-interest rates, and persistent inflation, resulting in increased caution among organizations, according to a survey from Deloitte India.

In 2023, increments are anticipated to be lower across most sectors compared to the previous year, with the life sciences and manufacturing industries predicted to have the highest increments at 9.5%. 

Meanwhile, the overall IT sector—including products and services—is expected to witness the sharpest decline to 9.1% from 10.3% in the previous year, mainly due to layoffs and cost optimization efforts by companies. Excluding products, the IT/ITeS sector is projected to have the lowest average hike at 8.4%. 

On the other hand, salary hikes in BFSI are expected to be at 8.6%, consumer products at 9%, and services at 8.8%, this year.

According to Deloitte’s survey, one in three organizations plans to provide double-digit average increments. Additionally, attrition levels increased from 19.4% in 2021 to 19.7% in 2022.

The survey indicated that many organizations are utilizing learning and development opportunities to build an improved employer brand. Around 27% of organizations have invested in skills-based training for gig workers, while 13% plan to do so.

It is crucial for organizations to deploy a common skills framework to identify gaps in their existing talent capability, with around three out of four companies recognizing the value of a common skills framework. However, about 42% of organizations do not revise their framework regularly to contextualise it to changing business requirements, as per the survey.

The survey also highlighted a significant gap in the awareness of skill requirements and associated learning. Only 19% of organizations confirmed that their employees have visibility of skills beyond their current role.

Nearly 66% of respondents surveyed have an Environmental, Social, and Corporate (ESG) governance framework that extends beyond a corporate social responsibility policy, and 21% are in the planning phase of designing one, indicating a growing focus on sustainability initiatives. The survey included nearly 300 organizations across seven sectors and 25 sub-sectors.

Source: Economic Times

Recent Articles

Modi and Macron strengthen defence ties, emphasise ‘Make in India’

June 14, 2024

Prime Minister Narendra Modi and French President Emmanuel Macron agreed …

Read More

Surge in foreign firms registering in India, Aviation and Engineering lead

June 14, 2024

Airlines and engineering companies are at the forefront of foreign …

Read More

Government initiatives propel Indian toy exports; more support needed

June 13, 2024

Government measures such as mandatory quality control orders and increased …

Read More