Who Stole My Salary Hike?

Employers will stay conservative on salary hikes this year, though business sentiment is looking up

- M.G. Arun

It’s appraisal season and there’s much anticipation in the air about what sort of hike is in store. Going by the surveys and feedback from manpower managers, there may not be much to cheer about for lower- and middle-rung workers, unless the positive sentiments in the business environment translate into real investments, throwing open better job opportunities.

Going by the estimates, employers have chosen to be ‘cautiously optimistic’ when it comes to rewarding staff in 2017. A KPMG survey says the average projected increment for the year 2017-18 is 9.7 per cent, a decrease of 0.6 per cent from 2016-17. Manpower organisations say most employers would prefer to be conservative on salary hikes this year compared to the previous years.

“There is bound to be muted salary growth at the bottom of the pyramid, since there is plenty of labour there,” says Manish Sabharwal, chairman of manpower firm, Team Lease Services. Moreover, the investment cycle hasn’t started and inflation is within control. “In the past few years there were big salary hikes because inflation was spiralling out of control,” he explains. In the top end, on the other hand, there will be a “delicate equilibrium”, he says. If the capex cycle starts, wage increases will be at much higher levels.

Manufacturing blues