2023 Pay Hikes Expected in India, Increased Emphasis on Executive Performance

According to a recent Survey by Aon, salaries in India are expected to go up by 10.3% in 2023 as organizations are increasingly prioritize their spends towards top performances, key talent, and high potential talent. Additionally, the salary structure for top executives in India now looks more like those in the U.S. with increased share of performance pay and link to ESG. 

Below are a few key take-aways: 

• Merit increase projections stay steady at 7.8%, the non-merit salary increase projections (increases on top of merit increase such as market corrections, special adjustments and promotions) is expected to moderate to 2.8%, which is higher than the historical average.
  
  
• Executives will receive a 9.1% salary hike on an average in 2023, but are required to meet long-term environmental, social, and governance, and gender diversity goals to claim additional incentives.
  
  
• For sectors, the projected salary increases for 2023 is the highest for technology platforms and products (12.9%), followed by e-commerce (12.2%), and technology and consulting services and financial institutions.
  
  
• Differentiated increments are applied to top performers, employees with a high potential or critical and those who with digital skills. 

Outlook: India, one of the biggest talent markets in the world, is not shy about providing the right compensation to its talent. Companies that operate in India should be aware of the trend and conduct timely benchmarking analysis.