Indian companies are expected to roll out average salary increases of about 9% in 2026, in line with the previous year, according to a recent Mercer Total Remuneration Survey covering more than 1,500 organisations. The findings indicate sustained confidence within the corporate sector despite a challenging global environment.
Sector-Wise Increment Trends
The Manufacturing and Engineering as well as the Automotive sectors are projected to lead salary growth, with average increments of around 9.5%. Global Capability Centres (GCCs) are also expected to announce hikes of nearly 9%, reflecting a continued focus on competitive compensation strategies.
Compensation Strategy and Workforce Trends
The survey highlights a stable approach to wage growth, with organisations balancing cost management and talent retention in a gradually slowing job market. There is an increasing emphasis on performance-linked pay and short-term incentives as part of overall remuneration structures, particularly to retain high-performing employees.
Hiring Outlook and Attrition
While salary increments remain positive, hiring plans show signs of moderation. Only about 32% of organisations indicated plans to expand their workforce by 2026, lower compared with previous years. Voluntary and involuntary attrition levels are also stabilising, suggesting a more cautious approach to workforce expansion as companies focus on efficiency and performance management.
Summary:
A Mercer survey suggests that India Inc may implement average salary hikes of 9% in 2026, with manufacturing, engineering, and automotive sectors leading the trend. While pay increases continue, hiring intentions are moderating as organisations adopt disciplined compensation and workforce strategies.
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