Indians Likely To See 9.5% Hike in 2025 As Attrition Rates Decline: Report

This trend highlights employers' strategic importance on talent in these industries amid the current economic landscape, as noted by the Aon report, a global professional services firm

Global capability centres (GCCs) and technology products and platforms are also optimistic, forecasting salary hikes of 9.9 per cent and 9.3 per cent, respectively

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Salaries in India are likely to rise by 9.5 per cent in 2025, up from this year’s increase of 9.3 per cent, according to a report released on Thursday. The engineering, manufacturing, and retail sectors anticipate double-digit growth, with salary increases expected at 10 per cent, closely followed by financial institutions at 9.9 per cent. 

This trend highlights employers' strategic importance on talent in these industries amid the current economic landscape, as noted by the Aon report, a global professional services firm.

Global capability centres (GCCs) and technology products and platforms are also optimistic, forecasting salary hikes of 9.9 per cent and 9.3 per cent, respectively. In contrast, the technology consulting and services sector expects more modest increments of 8.1 per cent.

In terms of attrition, a downward trend is evident, with average attrition rates reported at 16.9 per cent this year, a decrease from 18.7 per cent in 2023 and 21.4 per cent in 2022, as per the report.

Commenting on the report's findings, Roopank Chaudhary, partner and head of reward solutions in India for Aon, said, “Despite evolving global economic challenges, the study indicates a positive business outlook across several sectors in India. This sentiment continues in many of the domestically driven sectors, illustrated by the projected increments in the manufacturing, life sciences, and retail industries.”

The report analysed data from 1,176 companies across more than 40 industries between July and August. 

Organisations must stay updated on changing market conditions and rapidly evolving compensation trends to retain talent in a competitive job market effectively. “Having a holistic rewards strategy based on data and analytics will ensure organisations attract and retain the right talent and continue to build a resilient workforce,” Chaudhary remarked.

Tarun Sharma, associate director for Talent Solutions in India at Aon, noted that the recent decline in attrition rates presents businesses with a valuable opportunity to focus on internal growth, skill development, and enhancing long-term productivity.