Average increments at startups and early stage companies are forecast to be at 15.6% this year, up from 14% last year. The rest of India Inc is projected to give out 10.3% pay hikes, marginally lower than the 10.6% last year, according to Aon Hewitt's annual Salary Increase Survey 2015-16 that covered 700 companies in India.
The salary increment survey reveals that organisations that employ more than 15,000 people are budgeting lower salary increase numbers as compared to India Inc. average. The 100 biggest brands are projecting a salary increase of 9.5%, reveals the survey. Companies with more than 15,000 full-time employees project a salary increase of 9.8% while companies with more than 35,000 employees project a salary increase of 9.3%. Companies with more than 50,000 full-time employees project a salary increase of 8.7%, according to the survey released on Wednesday. "The larger the brand, the lesser its need to pay high increments," says Anandorup Ghose, Partner, Aon Hewitt. "For startups, salary increases are a necessity, and not a luxury. E-commerce companies and startups have to build their employer brand," he added.
Across companies, top performers are likely to walk home with 1.8X the average increments as organisations are accelerating the 'pay for performance' agenda. Salary increments on average are expected to settle in the range of 10-10.4% in the coming years. The discussion on pay increases is becoming far more nuanced than it used to be - from a large budget being equally distributed across the population, to a smaller budget being more sharply distributed, Ghose said.
Attrition level at 16.3% is the lowest that corporate India has observed since the 2009 financial crisis. While attrition was controlled at a broader level, key talent attrition increased from 5.9% in 2014 to 7.3% in 2015.