India pips other APAC countries with projected salary increment of 9.9%

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Posted by NewAdmin on 2025-01-31 09:26:23 |

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India Inc Set for 9.9% Salary Hike in 2025, Highest in APAC

India Inc is projected to witness a median salary increment of 9.9% in 2025, maintaining last year’s trend, according to the Korn Ferry India Compensation Survey. The retail and consumer durables sectors are expected to see increments of 9.5% and 9.0%, respectively, while IT services will likely experience a moderate hike of 6.5%.

India’s salary growth is set to outpace the APAC region, surpassing China (5%), Singapore (4%), and Japan (3.1%).

Talent Retention Over Workforce Reduction
Businesses are focusing on financial prudence while retaining talent, opting to moderate hiring instead of workforce reductions. “Companies are prioritizing retention over layoffs and scaling back initiatives,” said Navnit Singh, Chairman & Regional MD, Korn Ferry.

Senior Management Compensation Rising
With a strong emphasis on retaining senior talent, variable pay for senior management surged to 32% of total compensation in 2024, compared to 25% in 2023 and 23% in 2022. Meanwhile, variable bonuses for middle and junior management have remained stable.

Fair Pay and Competitive Rewards Strategy
India Inc remains resilient despite global economic slowdowns, with GDP growth stable at 6-7%. According to Vasudha Handa, Total Rewards Leader-Asean at Korn Ferry, organizations are focusing on pay equity, competitive compensation, and business-aligned rewards strategies.

Declining Employee Turnover
Overall employee turnover has declined in recent years:

• 2024: 15.4%
• 2023: 16%
• 2022: 17%

The highest turnover rates in 2024 were observed in:

• Retail (20%)
• Services (17%)
• Construction & Real Estate (18%)

Meanwhile, Industrial Goods recorded the lowest turnover at 11%.

Key Attrition Factors
The top three reasons for employee exits were:

1. Career Growth Opportunities
2. Compensation Package
3. Lack of Career Progression

With businesses focusing on fair pay and career growth, India Inc is poised for a positive hiring and compensation outlook in 2025.

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