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E-commerce, professional service firms projected to offer biggest pay hikes in 2020: Survey

The average pay hike given by cos in 2020 will be 9.1%, 20 bps or 0.2% down from 2019, as per the Aon survey.

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Last Updated: Feb 19, 2020, 08.20 AM IST
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Pay hikes in India to fall to decadal low in 2020: Aon survey report
Pay hikes in India to fall to decadal low in 2020: Aon survey report
As the Indian economy tries to recover from a slump, a survey conducted across more than a thousand companies spanning over 20 industries has found that two out of five companies are likely to offer double-digit salary hikes in 2020.

Aon plc, a leading global professional services firm, today, released the 24th edition of its annual Salary Increase Survey in India.

While e-commerce and professional service firms are expected to give a 10 per cent pay hike each in 2020, the transport and logistics sector, at 7.6 per cent, ranks the lowest in projected salary hike for 2020.

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The auto sector, which has been worst hit by the ongoing slump, has reported the biggest drop in average pay hike from 10.1% in 2018 to 8.3% for 2020.

“Despite economic challenges in 2019, organizations in India are taking a positive view. Pay increases in India continue to be the highest in the region. A big reason for India’s higher salary increase, as compared to other growing economies, is the high inflation rate and the war for key talent and niche skills,” Tzeitel Fernandes, Partner, Rewards Solutions at Aon, commented.

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According to the survey findings, the average pay hike given by companies in 2020 will be 9.1 per cent, 20 basis points or 0.2 per cent down from 2019 reflecting the weakness in the economy.

Navneet Rattan, Director, Organization, Performance and Rewards, Aon India, said, “We see a reduction in the differences between pay increases across industries, with 85% of the organizations projecting between 7%-11% - a sign of maturing business ecosystems. However, the premium for high performance and new age skills continues to rise.”

THE BAD NEWS
  • At an average 9.1%, hikes in 2020 will be the lowest in a decade
THE GOOD NEWS
  • 4 in 10 Indian firms may dole out doubledigit increments
  • 92% of employers have positive business outlook for coming year
THE REASONS
  • Low GDP growth
  • Poor business sentiment
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THE LUCKY ONES
  • Pharma, professional services, ecomm/early-stage firms likely to beat the average and offer double-digit hikes
  • Employees in hitech/IT sector, ITeS, FMCG and chemicals also likely to get better increments (close to 10%)
THE NOT-SO-LUCKY
  • Transportation/logistics firms likely to offer lowest increments (7.6%)
  • Hospitality firms/restaurants, real estate, automotive and telecom firms come next (8.2-8.5% hikes)
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Average pay hikes for India Inc likely to be around 7.8% for 2020: Deloitte Survey

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