eNewsletter

Companies in India are increasing worker incentives to recruit and retain top employees. One of the incentives includes raising salaries.  In 2011, companies in India increased salaries about 10-13% across industries.  Average wages increased from about $970 to about $1075.  Salaries increased the most in pharmaceutical and healthcare, banking, financial services and insurance, engineering, education and information technology.  Wages have also increased in India in the prior two years, at approximately 6.7% in 2009 and 11.7% in 2010.  Salary increases are expected to continue.

Some benefits are being offered in the form of bonuses. For example, on-the-spot bonuses are becoming increasingly popular. On-the-spot bonuses allow large companies to maintain equality in basic salaries in their labor force.  Employees are given an incentive to stay while base salaries remain the same. Companies have been offering employees on-the-spot bonuses to keep them from being poached.  Additional benefits include project allowances, benefits for travel to far-off locations and signing bonuses.

Some small and medium sized companies have expressed concern that the salary hikes have made it more difficult to compete with larger companies.  Though they have increased salaries as well, they are facing increasing challenges in retaining their employees.