However, unlike earlier trends, Deloitte’s most recent survey on compensation trends foresees a slowdown in salary increments for India in 2025, with employees across sectors feeling worried. According to the study by the consulting giant, salary increments are expected to dip below double-digit growth witnessed from the past few years, implying a sort of setback for working professionals.
Lower Pay Hikes Ahead
The report states that the average projected salary increment for the year 2025 in India is 8.1%, which is a slightly lower figure as compared to the 9.5% average salary increment recorded in 2024. The dip in increments has been basically attributed to a growing sense of caution among companies on matters of global economic slowdown, geopolitical uncertainties, and rising operational costs.
Sectors such as technology, manufacturing, BFSI, and telecom would be under the scanner for a more conservative salary revision. However, drug, renewable energy, and AI-based startup sectors would presumably offer attractive hikes to retain good talent.
Why Are Hikes Slowing Down?
According to Deloitte, key factors behind the current trend are:
- Pressures created by the global economy, especially from the US and European markets
- Reduced consumer demand and export growth
- Cost reduction strategies by the key corporates
- High attrition rate finding stability, hence easing the pressure to offer aggressive hikes
Besides, there is an increasing importance of going for performance-based pay structures and non-cash benefits like telecommuting and skill-based perks instead of annual increments offered to all.
Who Will Get Hit The Hardest?
- This will hurt the most for the mid-level and junior employees since entry-level hiring at the moment has slowed down, and further, promotions have been put on hold.
- Appraisals lower than the expectations may face employees in IT services, e-commerce, and retail,with industry-specific slowdowns to share the blame.
- Top performers, along with people holding demand skills, such as data science, cybersecurity, and analytics, may perhaps command better packages.
Expert View
Now pay hikes are not completely vanishing; they are definitely becoming more targeted and performance-driven. Companies are being wary and strategic.’- The HR lead from Deloitte
Conclusion
The 2025 salary outlook brings a reality check for the Indian employee. While jobs are stable, expectations about bigger pay hikes may have to be toned down. In this ever-evolving environment, professionals should engage in upskilling, diversifying their skills, and aligning alongside long-term business goals to keep pace.
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