Companies across India are expected to maintain a robust annual salary increase of about 9% in 2026, continuing the trend seen in the current year, according to recent compensation surveys. According to Mercer’s Total Remuneration Survey, conducted across 1500+ companies.
The manufacturing and automotive industries are forecast to deliver the highest average hikes, with projected salary increases near 9.5%, outpacing many other sectors. Global Capability Centres (GCCs) and other core business services are also planning competitive increments, typically around the 9% mark.
Economic Times HR reported that, while the overall pay adjustments remain steady, organisations are increasingly blending performance-linked incentives and short-term rewards into compensation strategies to secure key contributors in a moderately cooling job market.
A marked shift is visible in hiring sentiment, with the share of organisations intending to expand their workforce dropping from 43% in 2024 to 32% in 2026. At the same time, the proportion of employers yet to finalise their workforce plans has increased to 31%, underscoring growing uncertainty around future employment outlooks.
