That long-pending vacation you have been dreaming about could become a reality next year. Salaries in the private sector are expected to increase 10-15 per cent, according to the annual India Salary & Employment Outlook 2015/2016 by recruitment firm Michael Page. The report cites a growing economy and a talent crunch as the primary reasons for the rise.
Human resource professionals, though, advised caution, saying the rise could only be in the range of eight to 12 per cent. “Most sectors are still struggling,” said Vardha Pendse, director, Cerebrus Consultants, an HR firm. A quarter of the respondents in the survey said they expect the salary growth next year to be less than 10 per cent.
Ninety-nine per cent of the employers surveyed for the report said they would hike remuneration to retain talent, and 62 per cent of these increases are in the range of 10 to 15 per cent.
“The Indian market continues to grow with confidence, bolstered by high levels of investment,” Sebastien Hampartzoumian, senior managing director, Michael Page India, said.
Ecommerce is attracting talent from other sectors such as retail, fast moving consumer goods (FMCG), and consumer durables. Besides, the survey says, there is continued growth in sectors such as healthcare and infrastructure. With talent poaching becoming the norm to scale up operations, companies are trying retain high performers with counter offers.
Eighty-six per cent of respondents said their direct employees will receive a bonus as part of their remuneration, with almost half (49 per cent) of these in the 10-15 per cent range. The survey covered 240 employers from multinational companies as well as small- and medium-sized enterprises.
A candidate’s decision to accept a new role is influenced by brand reputation, career progression, and global opportunities, the report indicates. Millennials, in particular, seek a clear career progression that includes opportunities for development, overseas secondments, and promotions. Moreover, aptitude has emerged as a key attribute for hiring, the survey says.
Traditionally, workplaces gave preference to experience. But new sectors are changing that paradigm. “In terms of salary hikes, different sectors would see different growth rates,” says Pendse of Cerebrus. “Foreign banks and financial institutions are unlikely to offer major hikes, but employees of Indian banks may see a good salary growth.
Recent trends indicate that mid-level managers with experience of over five years are in demand, and it is this segment that could see the fastest growth.
“Management personnel below 40 years of age will get a higher raise because of their productivity,” Pendse says.
Meanwhile, entry-level salaries have not seen any increase, and are unlikely to go up next year. HR consultants say that campus placements of entry-level MBAs and engineers are happening, but their salaries have not gone up this year. “Most firms are hiring in the hope that this year would be better,” one expert said.
Key reasons why employees will leave their current company
The Michael Page report details the top 10 skills in demand, with Analytics and Big Data leading the field, with more than half the respondents listing it as the top skill area. Sales Development, Product Management and Project Management came in next.
The report also mentions how companies are giving non-financial incentives to retain top talent. Flexible work hours and work from home options featured as the top two incentives, with teambuilding activities a close third. Maternity and paternity leave, and sabbaticals are also emerging as key incentive areas.
An interesting tidbit from the report features top talent attraction methods. Financial incentives are ranked third in the list, while a strong company culture is rated the highest.
