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Compensation Trends Survey, 2013

Human Capital Consulting


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  • The median salary increments across sectors is projected at 11.3%, with highest increments in the Pharmaceuticals, Health Care and Life Sciences sector at 13.1%
  • The overall average attrition rate across industries is 14%. Better career opportunities and better pay have been cited as the key reasons for attrition across most sectors
  • Hiring and Retaining skilled talent has been identified as a perennial challenge for organizations

New Delhi, 22 April, 2013: Deloitte in India, Human Capital Advisory Services (HCAS) recently concluded a cross industry Compensation Trends Survey that provided key insights on salary increments and variable pay trends. A total of 155 companies participated in the survey and the key highlights include sectoral analysis on compensation trends.

Observing the survey trends, Thiruvengadam P., Senior Director, Human Capital Advisory, Deloitte in India opined that, “This year India witnessed further drop in increment figures as compared to last year. The overall median has dropped to 11.3%. Indian Economy is currently going through a challenging phase as GDP growth has slowed down to nearly a decade low in 2012-13 with domestic as well as external factors playing a part in this downfall. Macroeconomic issues such as high public expenditure, depleting investment and saving levels, worsening current account balance as well as depreciation of the Rupee have added to the present economic pressures.

Survey Highlights:

  • The median salary increments across sectors is projected at 11.3%
  • Highest increment figures have been reported in the Pharmaceuticals, Health Care and Life Sciences sector at 13.1%
  • The Financial Services sector continues its trend from last year, of being the most conservative sector in terms of increment projections for 2013 – 2014 at 9.6%
  • Overall Variable Pay (as a % of CTC) across sectors is 17.3 % which is an increase of 1.3% points over last year
  • The highest variable pay percent median is observed in the Financial Services sector at 20.1%
  • The overall average attrition rate across industries is 14%. Better career opportunities and better pay have been cited as the key reasons for attrition across most sectors
  • The highest attrition rates have been recorded in the ITeS (17%), Advertising & Media (16%) and IT (15%) sectors. These sectors are followed closely by Pharmaceuticals (14%) and the Infrastructure & Real Estate sectors (14%)
  • Hiring and Retaining skilled talent has been identified as a perennial challenge for organizations across most sectors. Developing potential future leaders is an emerging concern in many sectors

Sectorial Overview:


Consumer Business & Retail:

  • The median annual increment in this sector is 10% - significantly lower across most levels as compared to last year
  • The variable pay percent in the sector stands at 18.8% at the median level – a slight increase over that of last year
  • Attrition rate for this sector on average is 13%. Highest attrition rates for Junior and Middle Management – 15% - which is mainly due to the attrition rates in Retail

Manufacturing:

  • The increments in the Manufacturing sector are expected to be around 11.2% - the same level as the overall cross-sector median increment
  • Variable pay percent median for this sector is projected at 17.8%
  • The overall attrition rate for this sector is 12%. The highest attrition rate is at the Junior Management level (14%)

Infrastructure & Real Estate:

  • Increments have been conservative at 10.6%; increments have dropped considerably at the median level for this sector
  • The median variable pay for this sector is 15.4% - almost 2% points lower than the cross-sector median
  • Annual average attrition rates for this sector have been indicated to be 13% - this is consistent across all levels of management

Pharmaceuticals, Healthcare & Life Sciences:

  • The median annual increment in this sector is the highest across all sectors – at 13.1%
  • At 18%, the variable pay percent median of this sector is also higher than the cross-sector median
  • The average attrition rate for this sector is 14%. This is due to the attrition rate at the Junior Management level which includes Sales staff (17%)

Financial Services:

  • The median annual increment in this sector is 9.6%, a slight decrease over last year’s increment
  • The variable pay in this sector stands at 20.1% at the median level
  • The overall attrition rate for this sector is 15% - especially being a concern at the junior management level where it is 21%

Information Technology:

  • The median annual increment in this sector is projected at 10.7% which is slightly lower than last year’s increment (11%)
  • At a median of 16.3%, the variable pay this year for this sector has seen a considerable increase from last year (15.1%)
  • This sector has seen overall attrition of 15% across all levels. The highest attrition is seen at Junior and Middle Management levels - 18% and 15% respectively

Information Technology Enabled Services:

  • This sector is expecting a median annual increment of 10.3% - a considerable decrease from the 12.0% median increments observed last year
  • At the median level, the variable pay in this sector has risen significantly to 16.1% - almost at par with the overall cross-sector median
  • The highest attrition levels across all sectors is seen in the ITeS industry – 17% overall and 25% at the Junior Management level on average

Media & Advertisement:

  • The median annual increment in this sector is 10.2% which indicates a slight decrease from 11% in 2012 - 13
  • Analysis indicates that the variable pay percent in this sector is 14.4% at the median level - a significant rise over last year (10.5%)
  • Attrition is a major concern at the Junior Management level (23%) and the overall attrition rate for this sector (16%) is the second highest across all industries

Energy:

  • The median increments in this sector are projected to be the second highest this year at 12.4%
  • Variable pay has risen over last year’s median level to 16.5%. However, this is almost 1% point lower than the cross-sector median level
  • Average annual attrition in this sector is lower than other sectors, at 12%

Hospitality:

  • This sector has been introduced in this study for the first time
  • The median increment in this sector (11.1%) is almost at par with the overall cross-sector median
  • Variable pay (17.5%) is slightly higher than market median; however, range of variable pay across percentiles and levels is considerably high
  • Average annual attrition in this sector is recorded at 13%

Logistics:

  • This sector has been introduced in this study for the first time and has the second lowest increment median level across all sectors – 9.8%
  • Variable pay percent median of this sector is 15.6% with not much variation across levels
  • Organizations in this sector indicate an average overall attrition rate of 11%

 

Notes to the editor:

Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK Private Company Limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity.  Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu Limited and its member firms.

In this press note “Deloitte in India” refers to Deloitte Touche Tohmatsu India Private Limited, which is a company established under the Indian Companies Act 1956.

This press release has been given by Deloitte Touche Tohmatsu India Private Limited

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Malika Kumar
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Deloitte
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Senior Manager
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