Mumbai, February 24 Employees across various sectors are expected to receive an average salary increase of 9.1% in 2026, slightly higher than the 8.9% increase received last year, according to a survey released on Tuesday.
The projected 9.1% salary increase reflects a slight increase from the actual 8.9% hike recorded in 2025, which indicates sustained salary growth, according to AON, a global professional services firm, citing its 'Annual Salary Increase and Turnover Survey 2025-26 India'.
The latest survey, the 32nd edition, is based on an analysis of data from over 1,400 organizations across 45 industries in the country.
The projected salary increases will vary depending on the industry.
The workforce in the real estate and infrastructure sectors is expected to receive the maximum average pay increase of 10.2%, followed by those working in non-banking financial companies (NBFCs) at 10.1%, the survey found.
Employees in the automotive and vehicle manufacturing sectors are expected to receive a 9.9% increase, while those in engineering design services could expect a 9.9% increase.
Workers in the engineering and manufacturing sectors are expected to receive an average increase of 9.5%, while those in the retail industry are expected to receive a 9.5% raise.
These trends underscore that employers in India are focusing on strengthening technology, engineering, and customer-facing capabilities as organizations compete for specialized talent in an evolving market environment, the report said.
"India is entering the next phase of its growth story on a stronger macro foundation. Resilient domestic demand, moderating inflation, and new trade agreements are contributing to a positive medium-term outlook, even as firms navigate geopolitical uncertainty," said Roopank Chaudhary, partner and rewards consulting leader, Talent Solutions, India, for Aon.
The survey further revealed that overall attrition declined to 16.2% in 2025, returning close to pre-COVID levels and extending a downward trend over the past three years.
Attrition stood at 17.7% in 2024, falling from 18.7% in 2023, indicating steady improvement in employee retention across industries, it added.
With the implementation of new labor codes, organizations are now navigating one of the most significant regulatory transitions in decades, said Amit Kumar Otwani, associate partner, Talent Solutions, India, for Aon.
"The standardized definition of wages and expanded social security provisions are prompting many employers to reassess and restructure compensation. Clear communication around these changes will be critical to maintaining workforce trust and stability," he added.
