According to an Aon poll, India Inc.’s salary would increase by 9% in 2026, the least amount in more than ten years. As businesses reward top personnel during a recession, real estate and NBFCs lead rises.
The most recent Aon yearly Salary Climb and Turnover Survey 2024–25 India, which PTI published on Tuesday, projects that salaries in India would climb by 9% in 2026, the lowest yearly increase in almost a decade (apart from the Covid-hit 2020).
The slight increase from 8.9 percent in 2025 highlights a stable but cautious outlook as India continues to outperform its international counterparts in terms of investment, consumption, and policy support, despite a slowing global economy.
Despite moderation, the survey, which gathered responses from 1,060 businesses in 45 industries, indicates that infrastructure spending and domestic demand continue to drive India’s wage growth, which is among the highest in the world.
India’s economy remains robust despite the global slump
According to Aon, strong domestic consumption, consistent policy initiatives, and growing investment momentum continue to underpin India’s economic success.
According to Roopank Chaudhary, Partner and Rewards Consulting Leader, Talent Solutions, India at Aon, “India is developing on the back of sustained economic growth and reducing inflation, despite global and domestic obstacles.”
He went on to say that companies are now concentrating on incentive plans that increase employee flexibility so they can take advantage of opportunities in a changing global environment.
NBFCs and real estate will be at the forefront
According to the poll, the two sectors most likely to report the largest pay increases in 2026 are non-banking financial firms (10 percent) and real estate and infrastructure (10.9 percent).
According to projections, the automotive, retail, life sciences, and engineering design industries will all experience growth of 9.6 to 9.7 percent, which is indicative of ongoing investment in vital skill sets.
However, due to slowing exports and the increasing influence of artificial intelligence, technology consulting is expected to decline from 7% in 2025 to 6.8% in 2026.
“In terms of talent investment, important industries like real estate and NBFCs are setting the standard. In the face of uncertainty, companies are approaching pay strategically to guarantee stable employment and long-term development,” Chaudhary added.
Pay increases prioritize young, talented individuals
As businesses battle for younger, tech-savvy talent, Aon predicts that junior-level workers will get a little larger increase in pay, from 9.3 percent in 2025 to 9.5 percent in 2026, while senior and mid-level management wage growth will stay constant at 8.5% and 8.9%.
According to the survey, in order to retain key personnel and match compensation with changing business goals, many companies are directing larger pay expenditures toward top achievers and positions requiring specialized skills while total wage growth slows.
“Organizations are focused on strategic pay choices with compensation increases at their lowest in over a decade,” said Amit Otwani, Associate Partner, Talent Solutions, India at Aon. “In order to stay competitive, companies are giving top performers and skill-based jobs more expenditures.”
Layoffs are on the rise, but attrition is at a five-year low
Employee attrition decreased from 17.7 percent in 2024 and 18.7 percent in 2023 to 17.1 percent in 2025, the lowest level in five years, according to the report.
Employer-driven departures, or involuntary attrition, increased somewhat from 4 percent in 2023 to 4.6 percent in 2025, indicating that businesses are adjusting their labor strategy in the face of weaker growth.
“Involuntary departures are gradually increasing as voluntary exits decline. This demonstrates how businesses are reassessing their skills requirements and reorganizing their workforces to give new talents priority,” Chaudhary added.
Growth in real wages remains favorable
According to the survey, real wage growth—defined as salary growth less inflation—will increase from 4.7 percent in 2025 to 4.9 percent in 2026, indicating sustained job market resilience and moderate inflation.
India’s business sector seems to be entering a period of cautious optimism, with 43% of surveyed enterprises anticipating revenue growth over 10% in FY26 and 27% anticipating growth between 5% and 10%.