Employees in India are expected to see 9.2% salary growth in 2020, the highest in Asia, but real wages are anticipated to be just 5%, a report said on Monday.
According to Korn Ferry Global Salary Forecast, India’s salary growth for 2020 stood at 9.2% down from 10 % last year, while real-wage after adjusting for inflation may remain constant at 5 % in 2020.
“India has posted a strong growth despite real wages taking a hit globally. With current economic scenario and progressive reforms by the government, there is a sense of cautious optimism across sectors in India that continues to show high salary increments,” Korn Ferry India chairman and Regional Managing Director, Navnit Singh said.
The highest real wage growth is expected in Asia with salaries forecast to grow by 5.3% in 2020 and real-wage salaries expected to be 3.1% with an inflation rate of 2.2 %. India recorded the highest average real wage growth between 2008-17 in South Asia, according to an ILO report.
Roopank Chaudhary, Associate client partner, Korn Ferry India said, “Given the increasing cost pressures on the businesses, fixed salary sees a slow growth whereas high performers will continue to see steady growth in total remuneration including performance incentives (short and long term).”
Across Asian countries, Indonesia will have a salary growth of 8.1%, whereas, Malaysia, China and Korea would have a salary growth of 5, 6 and 4.1 % respectively. The lowest salary growth is expected in Japan and Taiwan at 2 % and 3.9 % respectively.
The report comes amidst slowdown of the economy which fell to a 6 year low to 4.5% during July-September 2019 quarter. Increased salary could boost consumer expenditure and have an impact on improving the condition of the economy.
The data was drawn from Korn Ferry’s pay database which contains data for more than 20 million job holders in 25,000 organizations across more than 130 countries. It shows predicted salary increases as forecast by global HR leaders for 2020 and compares them to predictions made at this time last year regarding 2019. It also compares them to 2020 inflation forecasts from the Economist Intelligence Unit.
(With inputs from agencies)