GCCs to provide highest salary increase in 2026: Report
The EY Future of Pay report said there will be sharper differentiation on how performance of employees will be measured and those with AI skills have the strongest premium
Global Capability Centers (GCCs) are emerging as the strongest drivers of salary growth and compensation innovation in India, with overall salary increments across India Inc. projected at 9.1% in 2026, according to the EY Future of Pay report.
According to the report, there will be sharper performance differentiation, rising AI skill premiums, and moderated attrition amid economic normalisation.
GCCs are set to lead salary growth in 2026 with projected increments of 10.4%, reflecting sustained global demand and investment in specialised digital capabilities. Financial services follows closely at around 10%, with ecommerce at 9.9% and lifesciences and pharmaceuticals at 9.7%, rounding out the top-performing sectors.
Attrition trends indicate a gradual normalisation in the workforce market, as overall attrition declined to 16.4% in 2025 from 17.5% in 2024. Notably, over 80% of exits remain voluntary, suggesting talent movement continues to be opportunity-driven rather than restructuring-led. GCCs reported relatively lower attrition at 14.1%, reinforcing their growing stability.
Commenting on the report findings, Abhishek Sen, Partner and Leader, Total Rewards, HR Technology and Learning, People Consulting, EY India, “We are at a turning point in how organisations think about investing in their people. The future of pay in India is no longer defined by the size of the annual increment alone. It is increasingly about precision – deciding which skills to invest in, which outcomes to reward, and how to balance competitiveness with sustainability.”
According to the report, as AI adoption accelerates across sectors, compensation models are being recalibrated to better reflect productivity, skill application, and measurable business impact. Between 50–60% of large organisations now use analytics in compensation planning, making data-driven decisions a core part of rewards strategy. At the same time, the use of AI across rewards and learning functions has tripled over the past two to three years, signalling a clear shift toward more intelligent and responsive people systems.
India’s compensation landscape is steadily shifting from role-based to skills-based models. Nearly half (45-50%) of surveyed organisations are shifting to skill-based pay frameworks. Further, emerging tech roles – such as AI, generative AI, machine learning, engineering can command up to 40% skill base premium.