India Inc. Likely to see 8.9% Salary Hike in 2023: Survey
The survey report finds India Inc. is likely to see an average salary increment of 9.8% in 2023, slightly higher than in 2022, and for top talent, the increase can be much more.
HIGHLIGHTS:
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- Average salary increment of 9.8% projected for 2023, slightly higher than in 2022.
- The report is based on the Korn Ferry India Compensation Survey, which covered 818 organizations with more than 800,000 participants.
- The survey revealed a projected annual increase in the total compensation .
- Tier 1 cities continue to receive maximum salary hike (higher compensation) in 2023.
Salary hike projected 8.9% for 2023 in India Inc.: Korn Ferry Survey Report
Korn Ferry, a global organizational consulting firm, is headquartered in Los Angeles, California. Drive organization transformation through people; conduct the India Compensation Survey for 2023, between July 2022 and December 2022.
The survey report finds India Inc. is likely to see an average salary increment of 9.8% in 2023, slightly higher than in 2022, and for top talent, the increase can be much more.
The Korn Ferry India Compensation Survey, which covered 818 organizations with more than 800,000 participants across sectors and offered insights on 15 broad industries, 75 sub-sectors, 75 job functions, and 1345 unique jobs, showed growth across sectors, which translated to a marginally increased forecast of 9.8% from the 9.4% in 2022.
The survey report reflects salary increase projections across sectors as follows:
| Industrial Sector’s | Projected Increase | Margin/Previous |
| Service Sector | 9.8% | +/- 0.01 |
| Construction & Building Material | 9.1% | +/- 0.01 |
| Life Science & health Care | 10.2% | +/- 0.01 |
| Utilities | 8% | +/- 0.01 |
| Automotive | 9% | +/- 0.10 |
| Chemical | 9.6% | +/- 0.01 |
| Consumer Goods | 9.8% | +/- 0.001 |
| Retail | 9% | +/- 0.1 |
| High Technology | 10.4% | +/- 0.002 |
| Industrial Goods | 9.9% | +/- 0.2 |
The survey revealed a projected annual increase in the total compensation (Total Cost to the Company) of an employee. However, the fixed annual cash in compensation structure (CTC) continues to comprise the biggest proportion of the salary of local employees in the India market. As employees move up the ladder, the compensation structure allows for more benefits and variable pay, while base salary and allowances decrease.
As per the survey report, employees in Tier 1 cities continue to receive maximum salary hike (higher compensation) in 2023 across India, when compared with Tier 2 and Tier 3 cities.
Navnit Singh, Chairman and Regional Managing Director, Korn Ferry said, “Although recession and economic slowdown are being discussed across the globe, there is an optimism about the Indian economy with a projected GDP growth of 6% upwards in 2023.”
“While the macroeconomic outlook is positive, there are new and increasing pressures on businesses: changing customer preferences, digital transformation, increased collaboration, and more. To this effect, organizations are focused on retaining critical and key talent through various talent management initiatives and formal retention and compensation plans”, Navnit added.
Singh further added that to stay ahead, most businesses will need to transform their workforce to meet these demands. “Also, with 60% of the organizations in our survey indicating that they have adopted some kind of hybrid model, it is prudent to say that the world of work is changing fast—not only the work organizations do, but how they do it.”
In alignment with India’s focus on accelerated digital capability building, the survey has projected substantial increments in life sciences and healthcare and high technology sectors at 10.2% and 10.4% respectively.
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