India’s salary growth to slow further in 2025: Survey
Aon’s survey reveals a steady decline in salary hikes since 2022, when companies offered a 10.6% increase amid the Great Resignation, dropping to 9.7% in 2023, 9.3% in 2024, and a projected 9.2% in 2025.
In 2025, salary growth in India is expected to decelerate further, extending a slowdown that has persisted for the past two years, according to a survey by global professional services firm Aon.
That said, India is still expected to see the highest salary growth among some of the major economies in the Asia-Pacific region. Salaries in India are expected to rise by 9.2% in 2025, marginally lower than the 9.3% increase in 2024, amid global uncertainty and slowing growth, according to Aon’s Annual Salary Increase and Turnover Survey 2024-25 India. It is based on data from over 1,400 companies across 45 industries.
The firm noted that salary hikes have been declining since 2022 when companies offered a 10.6% increase driven by the Great Resignation. This dropped to 9.7% in 2023, continuing the downward trend.
Projected salary increases for 2025 in select Asia-Pacific countries are: Indonesia (6.1%), China (5.3%), Malaysia (5%), Singapore (4.3%), and Japan (3.6%).
“The downward trend in projected salary increases could be in response to external factors like the geopolitical and economic developments, the potential impact of the US trade policies, conflict in the Middle East, and the explosive pace of generative AI advancements,” said Roopank Chaudhary, Partner and Rewards Consulting Leader for Talent Solutions for India at Aon.
Salary increases are expected to differ across industries, with engineering design services and auto/vehicle manufacturing leading at 10.2%, followed by non-banking financial companies (10%) and retail (9.8%). In contrast, life insurance (8.4%), telecommunications (8%), and technology consulting and services (7.7%) are projected to see the lowest increments, according to the survey.
“ The sector-wise increment trends for 2025 reflect prudence and adaptability as companies balance market challenges and the need to attract and retain talent across sectors,” noted Chaudhary.
Meanwhile, the overall attrition rate fell to 17.7% in 2024, down from 18.7% in 2023 and 21.4% in 2022, reflecting a larger talent pool. This stability in workforce availability results from higher labour force participation, even as self-employment and entrepreneurship grow.
“In a globally interconnected world, shifting governments, businesses, and workforce behaviours and expectations could impact the Indian economy and subsequently the local talent landscape,” said Amit Kumar Otwani, Associate Partner for Talent Solutions for India at Aon.
Edited by Suman Singh