Deloitte pegs average corporate salary increment in India at 9% in 2024

Corporate executives in India are likely to get an average salary hike of 9 per cent in 2024, said Deloitte in a report on Monday, projecting a figure that’s a tad lower than last year.

Deloitte India’s projection is lower than the 9.6 per cent pegged by EY in a report earlier this month. Deloitte India had forecast a 9.2 per cent salary hike in 2023.

Increments in 2024 will be better than pre-pandemic levels in all sectors except information technology (IT) and business process outsourcing (BPOs), according to the ‘Deloitte India Talent Outlook 2024’ report.

The number of employees expected to be promoted is fewer: 11.5 per cent in 2024 compared to 12.3 per cent in 2023.

Companies are likely to offer double-digit increments to junior management but "organisations may be stricter with their bell curves, making it harder to secure top ratings," it said.

Top performers may expect 1.8x in increments given to average-rated employees. For employees rated below average, the increment is expected to be lower at 0.4x this year than 0.6x in 2023.

One out of two companies could pay at-target or above-target bonuses in 2024. Organisations are likely to maintain a 7.5 per cent increment for promotions to retain key talent.

Attrition falls in 2023

According to Deloitte, attrition rate fell from 20.2 per cent in 2022 to 18.1 per cent in 2023 due to slower hiring. The EY report said attrition in 2023 was 18.3 per cent. The two numbers are below levels seen during Covid-19.

"With attrition and core inflation in check, organisations focus more on performance management strategies to protect and boost margins," said Anandorup Ghose, partner (CHRO Programme Leader) at Deloitte India said. "On a global scale, India continues to be the fastest-growing major economy and could witness the highest increment compared with other geographies."

 

As  many as 75 per cent of India organisations have a scientific framework to improve employees’ skills but their approach needs improvement, said Deloitte. Out of these companies, 25 per cent cannot update their training programmes regularly to match the evolving needs of business.  

"Although CXOs have better visibility of skill demand and supply across jobs, only 30 per cent of companies track and maintain this compared with 19 per cent last year. Most organisations prioritise usage and cost efficiency over directly linking learning interventions to financial improvement," it said.