With the Indian economy showing clear signals of recovery, private sector salaried class can expect higher increase in their salary this year. The global consulting firm Hewitt Associates has projected a 10.1 per cent increase in salaries, which is 4.3 per cent higher than that projected salary increase in the previous year.The annual India salary increase survey conducted by global conuslting firm showed that ‘in 2003, average salary increases will range between 8.5 per cent and 11.4 per cent across all employee groups, which is slightly higher than 2002 increase’. Additionally, only four per cent of all survey respondents indicated the possibility of a salary freeze in 2003, compared to 11 per cent in 2002, it said.Hewitt’s managing director for South Asia, Ravi Virmani, said that “the slight recovery in salary increases in India when compared with levels in 2002, indicates an improvement in the economic outlook as well as projection by companies across the Asia-Pacific region for higher average salary increases next year”.The survey, carried out on foreign-owned, locally-owned and joint ventures (and no public sector units), said salary increases were projected to rise to 10.1 per cent in 2003 from 9.7 per cent recorded in the previous year, showing a hike of 4.3 per cent. In the previous survey, Hewitt had found that salary increases fell to 9.7 per cent in 2002 from 12.8 per cent in 2001. Talking about sectors, Nishchae Suri, measurement practices leader for Hewitt in South and West Asia said that the average salary increase in 2003 is projected to be in the range of 10.1-12.7 per cent across the top-five sectors in 2003, with maximum of 12.7 per cent rise in ITES, followed by software development (12.3), IT solutions (11.3), FMCG/retail (11.1), accounting (11) and pharmaceutical (10.1).Employees in the banking industry are projected to be awarded the lowest average salary increases of 5.6 per cent in 2003 followed by those in entertainment/communication/publication (6.9 per cent) and chemicals (7.4 per cent). The bottom-five in salary increase in the survey found banks, automobiles, chemicals, hotels and financial services with projected increase ranging from 5.6-9.3 per cent in 2003.“The ITES, software development and accounting are all at present in a high-growth phase and the latent pool is far more mobile and dynamic than bank and chemical industries, which are relatively stable and mature,” Suri said.Suri added that banks will witness lower salary increase because they are alreay paying high salaries in absolute terms. The survey also said that the highest average salary increases for 2002 were awarded to employees in the professional/technical/supervisor group (10.9 per cent) for the third year in a row. This same employee group is projected to earn the highest salary increases in 2003 (11.4 ).The Hewitt survey projected 80.9 per cent increase in guaranteed salary for senior/top management level and 19.1 per cent rise in case of varibale pay in 2003. It found a drastic reduction in respondents vouching for salary freeze at 4 per cent in 2003 survey compared with 11 per cent in the previous survey.Seventy four per cent of the respondents of the survey said it was prudent to outsource non-core business activities and another sizeable 50.4 per cent faced challenges in attracting new faces and 50 per cent in retaining the talents.
