New Delhi: Corporate India grew an average of 8 per cent in 2021, and early estimates suggest that the average wage growth for 2022 to rise to 8.6 per cent in line with a healing economy and improving confidence, according to a Deloitte Survey.
According to the second phase of Deloitte’s Workforce and Wage Growth Trends Survey 2021, 92 percent of companies raised an average of 8 percent in 2021, compared to just 4.4 percent in 2020, where only 60 percent of companies raised their salaries. pay raise.
For 2022, the average wage growth is expected to rise to 8.6 per cent, equivalent to the pre-pandemic level of 2019, the survey said, adding that around 25 per cent of the companies surveyed have achieved double-digit growth for 2022. growth is projected.
The 2021 Workforce and Growth Trends Survey was launched in July 2021. The primary audience for this survey was experienced human resources professionals. More than 450 organizations participated in this edition spread across seven regions and 24 sub-sectors.
The survey further states that organizations will continue to differentiate pay hikes based on skills and performance and top performers can expect around 1.8 times the pay hikes offered to average performers.
“While most companies are anticipating high increase in 2022 As compared to 2021, we continue to operate in an environment where uncertainty related to COVID-19 persists, making forecasting difficult for companies. Some of the survey respondents have even closed their 2021 increment cycle, so 2022 wage hike is a fair distance away for them,” said Anandorup Ghosh, partner, Deloitte Touche Tohmatsu India LLP.
In addition, “GDP forecasts for FY 2021-22 were revised after the second wave and we expect the organization to closely watch similar growth next year while managing its fixed cost growth,” Ghosh said. he said.
The survey indicates that in 2022, the information technology (IT) sector is likely to offer the highest salary growth, followed by the life sciences sector.
IT is the only sector that is expected to expand double-digit growth with some digital/e-commerce companies planning to deliver some of the highest pay hikes.
Retail, hospitality, restaurant, infrastructure, and real estate companies are projecting some of the lowest pay increases in line with their business dynamics.
“It is heartening to see that most companies are increasing pay hikes in 2021, even in areas that have not yet fully recovered. Going forward, job specific pay increment discrimination may become more prevalent. because attrition rates vary significantly across skills.” Anubhav GuptaPartner, Deloitte Touche Tohmatsu India LLP said.
Gupta further added that “compensation is usually one of the top reasons for leaving a job, especially at the junior management level, where virtual hiring has made it easier to jump ships.”
The survey further said that around 12 per cent of employees were promoted in 2021 as compared to 10 per cent in 2020. About 12 percent of companies have updated their bonus or variable pay plans to align their reward structures with changing priorities.
With regard to hiring, 78 per cent companies said that they have started recruiting at the same pace as they did before Covid-19.
About 60 percent of organizations updated their health insurance policies and 24 percent of organizations re-adjusted their life insurance policies due to COVID-19. In addition, about two out of every three organizations re-adjusted their leave policy and introduced 14 to 21 days of special leave in addition to the regular annual paid leaves.
As far as return to work is concerned, only 25 per cent of companies have conducted an employee preference survey to decide return strategy.
In most cases where such a survey was conducted, employees prefer a hybrid work arrangement (a combination of work from home and office wherever possible). However, at all India level, only 40 per cent of the organizations have finalized their action strategy.
“Earlier, organizations used to decide who can work from home; they are now deciding who can/should work from office.
“While the hybrid model appears to be the preferred option, there are important questions regarding employee health and safety, flexibility and choice, governance, data security, business continuity, collaboration, teamwork and culture that need to be carefully considered first. Finalizing a strong return to work strategy,” Ghosh said.
According to the second phase of Deloitte’s Workforce and Wage Growth Trends Survey 2021, 92 percent of companies raised an average of 8 percent in 2021, compared to just 4.4 percent in 2020, where only 60 percent of companies raised their salaries. pay raise.
For 2022, the average wage growth is expected to rise to 8.6 per cent, equivalent to the pre-pandemic level of 2019, the survey said, adding that around 25 per cent of the companies surveyed have achieved double-digit growth for 2022. growth is projected.
The 2021 Workforce and Growth Trends Survey was launched in July 2021. The primary audience for this survey was experienced human resources professionals. More than 450 organizations participated in this edition spread across seven regions and 24 sub-sectors.
The survey further states that organizations will continue to differentiate pay hikes based on skills and performance and top performers can expect around 1.8 times the pay hikes offered to average performers.
“While most companies are anticipating high increase in 2022 As compared to 2021, we continue to operate in an environment where uncertainty related to COVID-19 persists, making forecasting difficult for companies. Some of the survey respondents have even closed their 2021 increment cycle, so 2022 wage hike is a fair distance away for them,” said Anandorup Ghosh, partner, Deloitte Touche Tohmatsu India LLP.
In addition, “GDP forecasts for FY 2021-22 were revised after the second wave and we expect the organization to closely watch similar growth next year while managing its fixed cost growth,” Ghosh said. he said.
The survey indicates that in 2022, the information technology (IT) sector is likely to offer the highest salary growth, followed by the life sciences sector.
IT is the only sector that is expected to expand double-digit growth with some digital/e-commerce companies planning to deliver some of the highest pay hikes.
Retail, hospitality, restaurant, infrastructure, and real estate companies are projecting some of the lowest pay increases in line with their business dynamics.
“It is heartening to see that most companies are increasing pay hikes in 2021, even in areas that have not yet fully recovered. Going forward, job specific pay increment discrimination may become more prevalent. because attrition rates vary significantly across skills.” Anubhav GuptaPartner, Deloitte Touche Tohmatsu India LLP said.
Gupta further added that “compensation is usually one of the top reasons for leaving a job, especially at the junior management level, where virtual hiring has made it easier to jump ships.”
The survey further said that around 12 per cent of employees were promoted in 2021 as compared to 10 per cent in 2020. About 12 percent of companies have updated their bonus or variable pay plans to align their reward structures with changing priorities.
With regard to hiring, 78 per cent companies said that they have started recruiting at the same pace as they did before Covid-19.
About 60 percent of organizations updated their health insurance policies and 24 percent of organizations re-adjusted their life insurance policies due to COVID-19. In addition, about two out of every three organizations re-adjusted their leave policy and introduced 14 to 21 days of special leave in addition to the regular annual paid leaves.
As far as return to work is concerned, only 25 per cent of companies have conducted an employee preference survey to decide return strategy.
In most cases where such a survey was conducted, employees prefer a hybrid work arrangement (a combination of work from home and office wherever possible). However, at all India level, only 40 per cent of the organizations have finalized their action strategy.
“Earlier, organizations used to decide who can work from home; they are now deciding who can/should work from office.
“While the hybrid model appears to be the preferred option, there are important questions regarding employee health and safety, flexibility and choice, governance, data security, business continuity, collaboration, teamwork and culture that need to be carefully considered first. Finalizing a strong return to work strategy,” Ghosh said.
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