India's Workforce Set for a Major Salary Boost by 2026

Employee salaries in India are projected to rise by 9% in 2026, with a shift towards short-term incentives and skills-based pay systems. The focus is on individual performance, inflation, and organizational competitiveness. Industries like High Tech and Automotive anticipate the highest increases.

Employee salaries in India are forecasted to increase by 9% in 2026, marking a significant shift towards short-term incentives and skills-based compensation systems, according to a report released on Wednesday.

The survey, conducted by Mercer's Total Remuneration Survey 2026, highlights that organizations in India are reshaping their remuneration packages. This change includes a focused approach on short-term incentives and transparency, aligning individual performance with organizational competitiveness in the job market.

Particular industries such as High Tech and Automotive are expected to lead with salary increases at 9.3% and 9.5% respectively. These shifts are part of India's broader strategy to embrace digital transformation and enhance employee wellbeing while managing costs effectively.

(With inputs from agencies.)