Expected Salary Hikes and Workforce Expansion in 2021: Report
NEW DELHI: In 2025, Indian employees are expected to see a significant increase in their salaries, with an average projected rise of 9.4 per cent, as per a total remuneration survey (TRS) conducted by HR consulting firm Mercer. This growth comes after a period of slow salary increases over the past five years, where salaries went up by 8 per cent in 2020. The anticipated salary hike is attributed to robust economic growth and a high demand for skilled talent, as revealed by the survey.
Automotive Sector Leading the Way
The automotive sector is poised to lead this salary increase, with a projected rise of 10 per cent, up from 8.8 per cent. This growth is fueled by the expansion of electric vehicles and the government’s ‘Make in India’ initiative. Following closely are the manufacturing and engineering sectors, which are expected to see salary increases rise from 8 per cent to 9.7 per cent, reflecting the ongoing recovery within the manufacturing ecosystem.
Voluntary Attrition and Workforce Demand
In a competitive talent market, voluntary attrition is predicted to stabilize at 11.9 per cent, with sectors like agriculture and chemical at 13.6 per cent, and shared services organizations at 13 per cent, experiencing the highest rates. The survey also highlighted a growing demand for talent in India in 2025, with 37 per cent of organizations planning to expand their workforce.
Strategic Recruitment and Talent Retention
To meet the demands of a growing workforce and sustain growth, many companies are expected to focus on strategic recruitment, competitive compensation, upskilling, and employee engagement to attract and retain talent while reducing turnover. Mercer’s India careers leader, Mansee Singhal, emphasized the importance of adapting to the changing talent landscape, stating that companies focusing on trends like pay premiums and performance-linked pay plans will be better positioned to attract and retain talent in a competitive market.
In conclusion, the survey indicates positive trends for employees in India, with salary hikes on the horizon and a growing demand for skilled talent across various sectors. Companies that prioritize strategic recruitment, competitive compensation, and talent retention strategies are likely to thrive in this evolving landscape of the Indian workforce.
**Takeaway:** Embrace the evolving talent landscape by focusing on strategic recruitment, competitive compensation, and talent retention strategies to attract and retain skilled employees in a competitive market.
