India’s job market is poised for another year of strong momentum in 2026, with salaries projected to rise by an average of 9 percent, according to the Aon Annual Salary Increase and Turnover Survey 2025–26. The study, now in its 31st year, draws insights from over 1,060 companies across 45 industries, making it one of the most comprehensive examinations of compensation trends in the country.
Despite global economic uncertainties, India’s robust domestic consumption, strategic investments, and proactive policy measures are contributing to steady economic recovery and workforce stability. The survey points to several key sectors—particularly real estate, non-banking financial companies (NBFCs), engineering design, and retail—as the frontrunners for salary growth in the coming year.
Top-Performing Sectors for Salary Growth
Among all industries, real estate and infrastructure are expected to see the highest salary jump at 10.9 percent, followed closely by NBFCs at 10 percent. These sectors are benefiting from increased investments, government-backed development projects, and demand for skilled professionals in urban planning, finance, and project management.
Engineering design services and retail are also anticipated to witness above-average growth, reflecting strong demand for innovation, consumer-centric expansion, and enhanced service delivery. Meanwhile, life sciences, global capability centres (GCCs), and FMCG sectors maintain steady upward trends, underscoring continued business resilience and the growing emphasis on digital and operational efficiency.
Projected 2026 Salary Increases by Sector:
- Real Estate/Infrastructure: 10.9%
- NBFCs: 10.0%
- Engineering Design Services: 9.7%
- Retail: 9.6%
- Life Sciences: 9.6%
- Global Capability Centres: 9.5%
- E-commerce: 9.2%
- FMCG/Fast Moving Consumer Durables: 9.1%
- Banking: 8.6%
- Technology Consulting & Services: 6.8%
This steady rise builds on the 8.9 percent growth observed in 2025, signaling India’s ongoing recovery trajectory and the maturing of its labour market.
Declining Attrition, Strengthening Stability
The report also notes a meaningful improvement in workforce retention. Attrition levels have declined to 17.1 percent in 2025, down from 17.7 percent in 2024 and 18.7 percent in 2023. This trend suggests a stabilizing labour market where companies are increasingly focused on upskilling, talent development, and career pathing.
“India’s growth story remains strong, supported by infrastructure investments and policy measures,” said Roopank Chaudhary, Partner and Rewards Consulting Leader, Talent Solutions for India at Aon. “Key sectors like real estate and NBFCs are taking a strategic approach to compensation, ensuring sustainable growth and workforce stability even amid global uncertainty.”
Policy Reforms and the Upskilling Imperative
Beyond market dynamics, recent tax reforms and compliance simplifications are reshaping corporate compensation strategies. As noted by Amit Kumar Otwani, Associate Partner at Aon, “Simpler compliance and rationalised tax rates are boosting efficiency. Companies that align their rewards strategies with these changes are best positioned to attract and retain top talent.”
This alignment is particularly vital for sectors like automotive and consumer goods, where digitisation, supply chain restructuring, and new product development require a mix of technical and managerial skills. Consequently, firms are investing more in structured learning programmes, leadership pipelines, and technology adoption to stay competitive.
Outlook: A Year of Sustainable Growth
The projected 9 percent salary hike reflects more than short-term optimism—it signals the maturing of India’s workforce ecosystem. Declining attrition, robust infrastructure investment, and policy-driven reforms are setting the stage for sustainable, skill-based growth.
As companies across India continue to focus on strategic talent investment and employee engagement, the year 2026 could mark a defining period of stability and advancement for the nation’s professionals—especially those in industries leading the pay growth curve.
In essence, the next wave of India’s salary expansion isn’t just about numbers—it’s about building a future-ready workforce equipped to sustain the country’s economic momentum well beyond 2026.
