Mumbai: Recruiters across India are speculating bigger pay rises for employees in the next fiscal years. A rise of about 8% in the paycheck is expected in the financial year starting in April 2020. However, the government being able to avert a third wave of the pandemic may play a key role.
A report by Michael Page and Aon Plc says that IT, e-commerce, pharmaceutical, and financial service sectors are more likely to offer their employees salary hikes. And retail, aerospace, hotels, and hospitality industries are likely to fall behind, reported Bloomberg.
Roopank Chaudhary, chief commercial officer for human capital solutions at India and South Asia at Aon, thinks that India's numbers have always been pushed up not necessarily by GDP or inflation. He added that the low availability of qualified applicants for the organized sector is likely to prop up salaries. Chaudhary clarified that there is no perfect correlation in India but the salary hike is large because of the demand-supply mismatch of talent.
The speculated hike of 8% is higher than the 6%-8% predicted by surveys for the current year. India has always reported Asia's highest increases. This trend is expected to continue in the next two financial years, said the Bloomberg report.
The magnitude has been declining in recent years after double-digit inflation earlier in the decade eased. The report also noted that the increase in consumer prices during the pandemic is due to short-term supply issues.
Michael Page and Aon Plc surveys haven't focused on informal labour in the country. The speculations are based on the organised labour sector, which only accounts for less than 20% of India's workforce.