According to the latest India Compensation Survey by Korn Ferry, shared with the Economic Times, employees in India are expected to receive the highest salary increments in the Asia-Pacific region this year, as the Indian economy remains more resilient than others amid a global economic slowdown.
India Inc is likely to see a median pay hike of 9.7% in 2024, compared to 9.5% last year, as companies try to balance a focus on cost management with a strong emphasis on retaining critical talent. In the Asia-Pacific region, Vietnam comes in a far second, with a 6.7% median pay hike expected in 2024 (6.8% in 2023), followed by Indonesia with 6.5% (6.4% last year), according to the survey. Employees in Japan are likely to receive the lowest increment at 2.5% (2.7% last year).
“India is a shining star in the global economy with the country’s GDP growth expected to outpace others in the global economic slowdown,” said Navnit Singh, chairman and regional managing director at Korn Ferry. “Indian companies are still on a growth path, and there continues to be a shortage of critical talent.”
In 2024, the highest salary increments of 10% are expected across financial services, global capability centres (GCCs), and product companies, chemicals, industrial goods, and retail industries, while IT services are likely to see the lowest increments of 7.8%.
Automotive (9.7%), construction and building material (9.6%), life sciences and healthcare (9.5%), and oil & gas, including utilities (9.5%), are among those offering median increments upwards of 9%, while consumer goods companies are likely to give lower pay raises of around 8.7%, found the survey of 706 companies.
Top and critical talent will be retained through higher differentiation. As per the survey, in 2023, organisations had a 60% higher incentive allocation for top performers compared to employees meeting expectations. The trend of fostering a culture that recognises and rewards exceptional performance is expected to endure.
“The differentiation is only becoming sharper; top performers stand to get 2x the incentives of average ones,” said Singh. While companies remain cautious about increasing costs as they strategise for the year, there is a strong commitment towards acquiring and nurturing critical talent through talent management initiatives and formal retention and compensation plans. “Organisations are in the midst of a great reset. Career paths are becoming more dynamic than ever, new jobs and roles are constantly emerging, and performance measurements are shifting,” said Singh. The study covered 706 organisations with more than 1 million incumbents offering insights across 13 industries.