India Inc is likely to dole out a 9% salary hike on an average for 2026 as companies continue to tread cautiously due to current geopolitical challenges and trade tensions, according to a survey by global professional services firm Aon.
The actual salary hikes for 2025 were the lowest in the last 15 years at 8.9% (barring 2020 when it hit the lowest 6.1% due to the onset of pandemic), according to Aon’s ‘Annual Salary Increase and Turnover Survey 2025-26 India’, which is in its 31st year. The projected number (announced in February) for 2025 was 9.2%, according to Aon.
In addition, the overall attrition rates have also declined to 17.1% in 2025, down from 17.7% in 2024 and 18.7% in 2023.
The study analyses data from over 1,060 companies across 45 industries.
“India’s growth story remains strong, supported by infrastructure investments and policy measures,” said Roopank Chaudhary, partner and rewards consulting leader, talent solutions for India at Aon. “Our survey shows that key sectors like real estate and NBFCs are leading the way in talent investment and businesses are taking a strategic approach to compensation to ensure sustainable growth and workforce stability, even amid global uncertainty.”
Sectors like real estate/infrastructure and non-banking financial companies (NBFCs) are likely to see the highest increases in 2026, according to the study. Automotive/vehicle manufacturing, engineering design services, retail and life sciences are also expected to continue rolling out slightly higher salary increases compared to other sectors in 2026.
The survey’s 9% projection for 2026 marks a slight increase from the actual 8.9% salary growth observed in 2025, even as global economic growth slows, according to the study. “Despite headwinds, India’s economy remains resilient, supported by strong domestic consumption, investments and policy measures,” according to Aon study.
“Recent tax reforms are transforming India’s business landscape by incentivising demand and enabling domestic consumption, especially for consumer goods and automotive sectors,” said Amit Kumar Otwani, associate partner, talent solutions for India at Aon.
“Simpler compliance and rationalised tax rates are boosting efficiency. Companies that align their rewards strategies with these changes will be best positioned to attract top talent,” he said.
The actual salary hikes for 2025 were the lowest in the last 15 years at 8.9% (barring 2020 when it hit the lowest 6.1% due to the onset of pandemic), according to Aon’s ‘Annual Salary Increase and Turnover Survey 2025-26 India’, which is in its 31st year. The projected number (announced in February) for 2025 was 9.2%, according to Aon.
In addition, the overall attrition rates have also declined to 17.1% in 2025, down from 17.7% in 2024 and 18.7% in 2023.
The study analyses data from over 1,060 companies across 45 industries.
“India’s growth story remains strong, supported by infrastructure investments and policy measures,” said Roopank Chaudhary, partner and rewards consulting leader, talent solutions for India at Aon. “Our survey shows that key sectors like real estate and NBFCs are leading the way in talent investment and businesses are taking a strategic approach to compensation to ensure sustainable growth and workforce stability, even amid global uncertainty.”
Sectors like real estate/infrastructure and non-banking financial companies (NBFCs) are likely to see the highest increases in 2026, according to the study. Automotive/vehicle manufacturing, engineering design services, retail and life sciences are also expected to continue rolling out slightly higher salary increases compared to other sectors in 2026.
The survey’s 9% projection for 2026 marks a slight increase from the actual 8.9% salary growth observed in 2025, even as global economic growth slows, according to the study. “Despite headwinds, India’s economy remains resilient, supported by strong domestic consumption, investments and policy measures,” according to Aon study.
“Recent tax reforms are transforming India’s business landscape by incentivising demand and enabling domestic consumption, especially for consumer goods and automotive sectors,” said Amit Kumar Otwani, associate partner, talent solutions for India at Aon.
“Simpler compliance and rationalised tax rates are boosting efficiency. Companies that align their rewards strategies with these changes will be best positioned to attract top talent,” he said.
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