This appraisal season, highest appraisals came from the ecommerce sector. It saw a salary increment of 12.5% according to a KPMG survey reported Mint. Interestingly, the same ecommerce sector also saw the highest voluntary attrition rate of 20.4%.
Over the next 2-3 quarters, the sector’s leadership focus will turn towards a better way of connecting with customers, according to the report in the Mint.
According to the report, the lowest increment was seen in the logistics sector at 8.1%. The biggest fall however, was in the banking and fincancial services sector which saw its increments fall from 9.7% to 8.1%. The same sector also reported the highest variable pay of 20.7%.
The report says that this indicates that organization are moving towards paying for performance variable pay holding a higher percentage in the cost-to-company.
The average projected variable pay across sectors saw a slight increase while the average projected increment has seen a slight dip.
For this fiscal (FY18), the report says that the average increment is projected at 9.7%, which is a 0.6% dip from FY17. Also, the average projected variable pay across sectors is projected at 15.4%, which is 0.4% higher than that in 2016-17.
The survey was conducted among 263 companies across 19 sectors including automotive and auto components, banking and financial services, consumer goods, energy, engineering and manufacturing, infrastructure, construction and real estate, information technology (IT) and IT-enabled services
Of this, around 77% of respondents said they identify high potential employees and offer them an average hike of 14.7% while 12% respondents reported giving an off-cycle salary hike.
Gamification (24%), robotics and cognitive automation (37%) and emergence of the gig economy (24.5%) were seen at the most important HR trends in the future.
The survey also looked at compensation levers to attract talent. These were seen as benefit offerings (26.3%), guaranteed incentives/variable pay (19.4%) and referral benefits/awards (16.6%).
And finally, speaking of attrition, nearly 23.4% of people leave jobs due to a better pay elsewhere, while the second most common reason is better career opportunities (23.4%). Also, around 19.6% of people leave for personal reasons.