In an environment of constantly changing macro-economic conditions and a rapidly evolving rewards landscape, it becomes extremely critical to keep abreast with the current market trends. Keeping with the commitment of bringing periodic updates on performance and rewards to our clients, Aon Hewitt conducted a mid-year dipstick in May-June 2011 as a follow-up to our 15th Annual Salary Increase Survey concluded in March 2011. The objective of the dipstick was to gauge the difference between the salary projections made during January-March 2011 and the actual salary increases paid out in 2011. The survey covered 214 organizations across 12 primary and 28 secondary industries. The study reveals that salary increases in corporate India continue to be the highest when compared with other economies in the Asia Pacific region. As indicated by the study, the actual annual salary increase in India ranges between 12-14% across industries and the trend is expected to continue for the next 3-5 years. The typical variance between projections and actual salary increases provided in 2011 is within the range of (+/-) 0.5% across sectors.
Sectors reliant on domestic consumption such as engineering/manufacturing, energy, infrastructure and engineering services continue to be the market leaders in the trend. Outsourcing and technology have had a big positive swing from the recessionary period of 2009 and have given a 12% increment to their employees in 2011. Thriving on increased consumer spending; retail, automotive and FMCG have provided higher than projected increases in 2011. However, due to the rising fuel, raw material & input costs and interest rates, these industries might feel the pinch in the short-term. Further widening of pay gap is definitely on the horizon as organizations are committed to differentially reward their top talent. Increments for top performers are 18.2% vs. 10.4% for average performers, taking this ratio to 1:1.8 for India. While on one hand, this metric is sharper for services industries such as IT, ITeS, telecom and retail, it is lower than India average for manufacturing industries such as automotive, energy and engineering. The given industry dashboards weave the story of performance and rewards trends in India in 2011.