Curation Team
NEW DELHI: Salaries across India are projected to increase by nine percent in 2026, driven primarily by strong growth in real estate and non-banking financial companies (NBFCs), according to a recent study by Aon, a global professional services firm.
Real estate and infrastructure drive talent demand
The study shows that the real estate and infrastructure sector is set to witness one of the highest salary increases at 10.9 percent in 2026, up from 10.5 percent in 2025. The sector’s sustained momentum comes on the back of government-led capital expenditure, real estate upcycles in commercial and residential segments, and rising institutional participation.
Roopank Chaudhary, partner and rewards consulting leader of the company, noted that infrastructure investments and policy reforms have bolstered hiring sentiment. “Key sectors like real estate and NBFCs are leading the way in talent investment as businesses align compensation strategies to sustain growth and workforce stability,” he said.
Cautious optimism in broader sectors
NBFCs are expected to post a 10 percent average hike in 2026, the highest among financial institutions, followed by asset management firms (9.5 percent) and banking (8.6 percent). Sectors such as retail (9.6 percent), life sciences (9.6 percent), and engineering design services (9.7 percent) are also likely to see healthy pay growth.
Technology consulting and services, however, continue to remain conservative, with the lowest projected hikes at 6.8 percent due to efficiency measures and global headwinds.
Amit Kumar Otwani, associate partner at the company said, “Organisations are cautiously optimistic, setting pragmatic salary budgets while balancing performance-linked increments with the need to retain critical talent pools.”
Attrition on the decline
The overall attrition rate in India has declined to 17.1 percent in 2025, the lowest in five years, compared to 17.7 percent in 2024 and 18.7 percent in 2023. Involuntary exits have marginally increased to 4.6 percent as companies focus on right-sizing and performance-led workforce restructuring.
The study attributes the trend to improved employee engagement and stability, particularly in sectors such as real estate, NBFCs, and automobile manufacturing, which are aggressively investing in retention and capability-building.
India outpaces global peers
Globally, India remains a standout performer with one of the highest projected salary increases (9 percent) among major economies in 2026. By comparison, the U.S. and Germany are expected to see average increments of about 4.3 percent and 3.9 percent, respectively. Aon’s data suggests that India’s strong domestic consumption, fiscal incentives, and relatively low inflation are sustaining its robust labour market even as global growth slows.
Shift toward strategic workforce planning
Companies are moving from “just-in-time” to “just-in-case” workforce models to build resilience against trade and supply chain disruptions. There’s a growing integration of AI and automation in operations, which is streamlining job roles and reducing long-term workforce costs.
Outlook
Aon anticipates that organised sectors—especially real estate and financial services—will continue to outpace the broader market in salary increases. With stronger retention, moderated inflation and targeted rewards, companies appear to be pivoting from aggressive hiring to strategic workforce consolidation, ensuring steady productivity and profitability in FY26 and beyond.
