Professionals in India may be disappointed with the projected average pay increments for 2026—merely 8.9 per cent. This is way lower than the increment of 9.1 per cent last cycle.
Why? The reason could be that more and more companies are granting better increments to their top performers and employees possessing niche skills. The rest of their employees, meanwhile, are having to settle for flatter increments.
As per OMAM’s ‘Salary & Attrition Trends: Increment Outlook Report 2026’, the average pay hike in 2026 is likely to be about 8.9 per cent only. Average attrition is expected to continue to hover around 13.6 per cent.
During the survey period of September to October, economic uncertainty was urging employers to be cautious and control their budgets for salaries. Additionally, many sectors had experienced a slump while others were focussing more on differentiated pay.
This slowdown or moderation in the rate of increments is prominent in the information technology (IT), e-commerce, fast-moving consumer goods (FMCG), fast-moving consumer durables (FMCD) and automobile sectors.
In the IT sector alone, it is predicted that the average pay hike may dip from 8.2 per cent in 2025 to 7 per cent in 2026.
In the e-commerce space, the hike is expected to drop from 9.2 per cent to ten per cent. For fast-moving electrical goods (FMEG) and fast-moving consumer durables (FMCD), the increment is expected to fall to 8.7 per cent from 9.5 per cent. The automobile sector is likely to see an average salary increment of 9.8 per cent, while it was 10.5 the previous cycle.
The core industrial sectors will see a drop from 9 per cent to 8.7 per cent. In the chemical sector it will likely drop to 9 per cent from 9.5 per cent.
Resilience is expected in some sectors, such as insurance and telecom. While the insurance sector will likely enjoy an increment around 9 per cent, the telecom sector is likely to witness higher hike of 9.1 per cent compared to 9 per cent last cycle.
Instead of focussing on fixed pay, stable organisations are dedicating a greater share of their budgets to total rewards, benefits, retention measures and development-linked incentives.
