Salary Hikes In India May Remain Static At 8-10% In 2019
With technology replacing a lot many traditional jobs, the year passing-by appears to be a transition year for the employment space with hiring for several entry-level profiles taking a big hit in 2018 and average salary hikes remaining static in a range of 8-10 percent.
Experts and hiring managers are hopeful about more than 10 lakh new jobs in the new year, though salary hikes may still remain the same. People with some specific evolving skills, however, may get much more.
Employers are expected to keep a cautious approach at least in the first half of 2019 due to evolving political uncertainties relating to national elections, despite employment generation being a key poll plank for almost all political parties.
Job creation has been a subject of big debate in the recent past, as despite a fast pace of overall economic growth, the level of employment generation has not kept pace with an estimated 12 million people entering the labour market each year in the recent years.
The experts rue that the situation has been further confounded by lack of sufficient, credible and periodic data on job creation.
Following the twin disruptions of demonetisation and the implementation of GST in the previous year, 2018 has still turned out to be a year of recovery for the Indian job landscape.
"It is ironic that while job creation will be a crucial plank on which the national elections will be fought, organisations may actually be taking a cautious approach to rolling out their business plans for 2019, thereby negatively impacting job creation at least for the first half of the year," said Nishith Upadhyaya, head of advisory services at Society for Human Resource Management (India).
The industries that are directly correlated to government schemes for infrastructure, roads, highways and airports may proceed cautiously till at least May 2019, by when the new government is expected to be in place.
Other sectors, whose products and services are dependent on local consumption and exports, are expected to go ahead with expansion and recruitment plans.
According to HR service provider Randstad India chief Paul Dupuis, IT industry turned the corner this year in terms of hiring after two years of tepid job creation, helped by improved availability of skilled talent in new-age technology areas and big-ticket investments in the e-commerce sector.
Other sectors that showed improvement this year include infrastructure, manufacturing, retail and FMCG, while the job scene for banking, financial services and telecom appeared difficult.
Going ahead, banking, financial services, retail, logistics, IT/ITES, e-commerce, start-ups, consumer goods, infrastructure and healthcare will see the maximum growth in 2019, said Rituparna Chakraborty, president of Indian Staffing Federation.
Chakraborty said retail would capitalise on increased consumer spending in non-metro and smaller cities, which in turn would drive employment growth.
According to Sameer Nagpal, director of employability solutions at Aon CoCubes, salary hikes in India are stabilising around the 9-10 percent, which is the highest in the Asia Pacific region.
As per Aon's latest survey, despite improvement in macroeconomic forecasts, the salary increments for 2018 stood at 9.5 percent, while, the projections for 2019 are at around 9.6 percent.
"For people who are already employed, average salary hike can range anything between 10-12 percent, wherein top performers may get 15-20 percent and average performers can expect 5-8 percent. But, for many specific skills, people may end up getting hike of 30-50 percent," said Sunil Goel, managing director of executive search organisation GlobalHunt.
As per experts, one of the most significant HR trends of 2018 has been the way automation and artificial intelligence is transforming the world of work, while also posing a significant threat to job roles that are structured and repetitive.
Aon CoCubes' Nagpal said the focus is shifting from mass hiring to hiring of employees with specific business critical skills.
"Entry level profiles like shop-floor roles in production lines and technicians in manufacturing are among the worst impacted as these jobs are fast being replaced by technology. The maximum impact has been at the junior management and clerical levels where hiring has gone down by 23-25 percent," Nagpal said.
In a recent Mercer survey, more than half of surveyed companies across industries indicated intention to hire more people till 2018-end and the “hot jobs” were found to be in R&D, sales and engineering.
Mercer India's Shanthi Naresh said the need for replacement talent will remain strong, given an attrition rate of 8.6-12.5 percent across professional and management levels.
Some major hiring trends of 2018 have been the increasing use of digital and social tools; growing adoption of virtual reality and video-based profiling and interview; and intelligent screening and assessment. Also, there has been a surge in use of social media platforms like LinkedIn and Glassdoor.
Moreover, job seekers seem to give higher preference to workplace culture, learning and growth opportunities, innovation and work-life balance over salary and other benefits.