Employees can expect higher salary hike this fiscal as companies try to retain top talent: Experts
Employees can look forward to an average hike of 9-12 percent while top talent may get as much as 15 percent raise this year as improving hiring pace is pressing organisations to retain their key performers, say HR experts.
Companies are increasingly making a sharp differentiation between high and average performers and are adopting measures like variable pay, increments and career opportunities to differentiate between them, they said.
Consumer-driven sectors such as FMCG/CD, retail, media & advertising are giving positive appraisals this year.
“Appraisal percentage in the current year will be on an average 9-12 percent; it is little higher than previous year wherein the increase in compensation is going to be more at mid-junior level as compared to senior level,” said Sunil Goel, MD GlobalHunt, an executive search firm.
Joseph Devasia, Managing Director of Antal International India, a global executive recruitment firm, also noted that “appraisals for 2016-17 were slightly impacted due to demonetisation and in 2017-18 it was the GST implementation that slowed down businesses”.
Devasia further noted that the Indian economy and the job market seem to have now picked pace, and financial year 2018-19 seems a lot more positive across sectors.
“Companies want to retain top talent as hiring has picked pace across sectors,” Devasia added.
According to a study by HR consultancy Aon, firms have either made changes or are planning to make changes to their performance management systems to retain top talent.
Around 75 percent firms use variable pay, 91 percent use increments and 71 percent use career opportunities to differentiate between average and high performers.
Moreover, 47 percent firms pay variable salary of more than 1.5 times to high performers than average performers.
Experts believe, in terms of cities, Bangalore and Delhi top the highest percentage as compared to Mumbai, Pune, Chennai, Hyderabad, and Kolkata.
“Overall, Indian companies covering both MNCs and startups will experience a pay hike of 10-15 percent for the right talent in 2018 after a challenging year for the job market, stunned by post- demonetization layoffs in traditional sectors followed by the advent of artificial intelligence in new-age ones,” said Amit Munjal, Founder and CEO, Doctor Insta, a video medicine platform.
With PTI inputs