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Indian salaries set to rise 9.1% in 2027 as employers hold budgets steady, Aon survey finds

Why are companies using non-merit pay adjustments more often? Understand the trends shaping India’s 2027 pay planning

October 14, 2026

Salary increases look steady at around 9%, but inflation and a weaker rupee could eat into them. Read the key takeaways from Aon’s survey

Pay Hikes Hold Steady for 2027: Which Sectors Will Pay More, Which Less

Pay packets in India are expected to grow by an average of 9.1 per cent in 2027, according to a new report by professional services firm Aon. The projection is barely above the 9 per cent increase in 2026, suggesting that employers are keeping compensation budgets steady despite global uncertainty.

Who was surveyed

The findings come from Aon’s Annual Salary Increase and Turnover Survey for India 2026-27. It covers more than 1,200 organisations across 45 industries, making it one of the country’s largest compensation studies.

Which sectors will pay the most

Non-banking financial companies (NBFCs) are set to lead with an average hike of 10.1 per cent in 2027. Energy follows at 9.9 per cent, and real estate and infrastructure at 9.8 per cent. At the other end, technology services is expected to lag, with hikes of around 6.6 per cent.

Retention remains a headache

Attrition has climbed to 18 per cent, which makes keeping talent harder for employers. The report also points to a rise in non-merit pay adjustments, especially in manufacturing and technology. Companies use these to bring salaries closer to market rates or to fix pay gaps for employees whose skills are in high demand.

A more targeted approach

According to the report, steady budgets are letting employers be more selective. Companies are looking not just at how much they spend on pay, but at where that spending delivers the most value for the workforce and the business.

What it means for take-home value

The headline hike looks healthy at about 9 per cent, but inflation and rupee depreciation could reduce its real value, especially when compared with earnings in other markets.

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