With the trend of meager pay hikes and a higher emphasis on productivity and performance, a drop in pay increases to an average of 9.5 per cent is projected in 2017 across industries, according to a survey Aon Hewitt India. It was 10.2 per cent in 2016. The lowest projected hike was 6.6 per cent in 2009 during the global financial crisis.
The Indian technology services sector is facing its worst growth period in close to a decade as they see clients reducing budgets on traditional outsourcing work, which is not being offset by growth in newer areas such as digital and cloud. In addition, routine maintenance work of customer applications or IT infrastructure, where freshers are normally deployed have been taken over by automation or robots, reported Business Standard earlier.
Nasscom has unexpectedly postponed issuing a growth projection for 2017-18, a first in 25 years, in the wake of uncertainty due to regulatory changes in the US and the macroeconomic outlook.
With use of automation, these companies
are shifting their employees from projects, where their jobs have become redundant and training them on skills to match new requirements. Infosys and its cross-town rival Wipro shifted more than 8,000 employees from projects to other roles due to automation during the first half of this fiscal.
While traditionally pay increases in India have not been affected by inflation rates, the survey said that the significant drop in Consumer Price Index (CPI) over the last few quarters has also been a good opportunity for companies
to manage their compensation budgets.
The research shows that the segment of population that features as 'high performers' have fallen to 7.5 per cent, the lowest number recorded in the 21 years of the Salary Increase Survey in India.
Even sectors like consumer internet companies
which had seen 15.5 per cent hike last year will see a much lower hike of 12.4 per cent in 2017.
In order to check attrition and keep it under control, many organisations cited having reward & recognition policies in place, investing in learning & development programmes, and offering well defined career progression plans to employees.