India Salaries Set to Rise 9% in 2026, Aon Survey Shows Strong Sectoral Variation

Salaries in India are projected to grow by 9% in 2026, according to the latest Aon Annual Salary Increase and Turnover Survey, which analyzed data from over 1,060 companies spanning 45 industries. This marks a slight increase from the 8.9% average salary growth recorded in 2025, underscoring continued confidence in the country’s economic resilience, driven by robust domestic consumption, investments, and proactive policy measures.

Sector-Wise Salary Trends

The report highlights notable differences across industries. Real estate and infrastructure and nonbanking financial companies (NBFCs) are expected to lead salary growth in 2026, with projected hikes of 10.9% and 10% respectively. Other sectors offering relatively higher pay increases include automotive/vehicle manufacturing, engineering design services, retail, and life sciences, reflecting companies’ focus on investing in critical talent pools and niche skill sets.

Conversely, technology consulting and services are likely to see more modest growth, with projected salary increases easing slightly from 7% in 2025 to 6.8% in 2026. Analysts attribute this to slowing export demand and evolving impacts from artificial intelligence on the sector.

Talent Retention and Attrition Trends

India’s overall employee attrition has declined to 17.1% in 2025, the lowest level in five years, down from 17.7% in 2024 and 18.7% in 2023. This trend points to greater workforce stability, enabling companies to focus on upskilling and talent development initiatives. However, involuntary attrition has slightly increased, suggesting strategic workforce reshaping as firms prioritize new capabilities and performance standards.

Also Read: Average Income of Indian Workers Surged By Rs 4,565 Over The Past Seven Years: Survey | Republic World

Expert Insights

Experts at Aon emphasized the need for targeted compensation strategies in a dynamic market. Roopank Chaudhary, partner and rewards consulting leader at Aon, said key sectors are driving talent investment through strategic pay decisions that balance workforce stability with growth. 

Amit Kumar Otwani, associate partner at Aon, noted that recent tax reforms are boosting domestic demand, particularly in automotive and consumer goods, while simplified compliance and rationalized tax rates are enhancing operational efficiency.

As companies navigate global uncertainty, the report signals a cautious yet confident outlook for salary growth in India, with targeted investments in talent continuing to shape sectoral competitiveness.