New Delhi: Corporate India is projected to implement an average salary increase of 9.1% in 2026, with Global Capability Centres (GCCs) driving the highest growth in employee compensation, according to a report released on Monday.
GCCs are expected to offer the highest increments at 10.4 per cent, driven by strong global demand for digital and technology capabilities, according to the latest Future of Pay report by EY India.
The financial services sector is likely to see salary hikes of around 10 per cent, followed by e-commerce at 9.9 per cent and life sciences and pharmaceuticals at 9.7 per cent, the report said.
The report also highlighted a gradual cooling in attrition levels. Overall attrition declined to 16.4 per cent in 2025 from 17.5 per cent in 2024, indicating a more stable job market.
However, more than 80 per cent of exits remain voluntary, suggesting that employees are still switching jobs for better opportunities rather than due to layoffs.
Financial services recorded the highest attrition at 24 per cent, while professional services and hi-tech and IT sectors also saw elevated levels.
In comparison, GCCs reported relatively lower attrition at 14.1 per cent, as per the report.
Abhishek Sen, Partner and Leader, Total Rewards, HR Technology and Learning at EY India, said companies are rethinking how they invest in talent.
“The future of pay is no longer just about the size of annual increments but about identifying the right skills to reward and balancing competitiveness with long-term sustainability,” he noted.
The report points to a major shift towards skills-based compensation. Nearly half of the organisations surveyed are moving from traditional role-based pay structures to skill-based frameworks.
Professionals with expertise in artificial intelligence, generative AI, machine learning, cybersecurity, and cloud computing can command salary premiums of 30 to 40 per cent, as these skills are becoming critical for business growth.
Variable pay is also gaining importance. The average variable pay as a share of fixed salary rose to 16.1 per cent in 2025, compared to 14.8 per cent a year earlier.
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–IANS
