This year is going to be a great year for the private employees of the country in terms of salary increase. The salary increase in India in the year 2026 is estimated to be 9.1%. This is slightly more than the 8.9% increase recorded in 2025. This information has been given in Aon India’s 32nd Annual Salary Increase and Turnover Survey 202526. This survey includes data of more than 1,400 companies from 45 industries. This slight increase shows that India’s job market remains strong despite global uncertainties and changing regulations in the country.
Salary increase is expected to be different in different industries in the year 2026. Real estate and infrastructure sectors, as well as non-banking financial companies (NBFCs) are likely to see the highest growth. Apart from this, sectors like automobile and vehicle manufacturing, engineering design services, engineering, manufacturing and retail may also see slightly higher than average growth. This trend shows that companies are investing more in technology, engineering and customer-facing roles as the demand for specific skills is increasing.
Rupank Chaudhary, Partner and Rewards Consulting Leader, Talent Solutions, Aon, India, said that India is now entering the next phase of development with a strong economic base. He cited strong domestic demand, falling inflation and new trade agreements as the main reasons for growth in the medium term.
India ahead in the world
India’s 9.1% salary increase in the year 2026 is much higher than the major economies of the world. According to Aon’s Global Outlook, salary growth is expected to be 4.3% in the US, 4.1% in the United Kingdom, 3.9% in Germany, 3.7% in Japan, 4.8% in China, 4.2% in Singapore, 3.9% in Australia and 4.9% in Brazil. Moreover, India’s GDP growth in 2026 is estimated to be around 6.2%, whereas in many developed countries it is likely to be less than 2%. These figures show that India remains one of the fastest growing major economies in the world and salary growth reflects the strong domestic economy and continued demand for talent.
Attrition rate decreased
According to the survey, the total attrition rate has reduced to 16.2% in 2025. In 2024 it was 17.7% and in 2023 it was 18.7%. The continued decline shows that pre-pandemic stability is returning. Companies are now paying more attention to better hiring planning and employee participation. This change is believed to be the effect of the wage code. After the implementation of Labor Code in India, companies are going through major rule changes. According to the report, 73% of the companies are still understanding the impact of the wage code. 12% companies will meet this through salary increase budget and 15% companies are creating a separate fund. Not only this, there will be changes in the salary structure. 35% companies are planning to increase the basic salary so that the 50% wage rule can be met. 34% companies will make changes in both basic and allowances. The structure of 15% companies is already as per the rules.
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