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In a move to make up for the missed out pay hikes in 2020, Indian companies have been given bigger hikes in 2021 as compared to 2019, The Economic Times reported on Monday. Companies such as RPG Group, Aditya Birla Group and Raymond’s increments have gone back to the pre-pandemic levels as the entire economy is picking up pace. According to data from the publication, about 102 companies following the appraisal cycle in June-July have paid out average actual increments of 9.3% in 2021, against 6.2% in 2020.

Salaries hiked due to high attrition rates

According to industry executives and HR heads, the increased hikes are a result of economic recovery and improved consumer sentiment.

The improved hikes are a clear indication of the rise in pent-up demand, along with the intent of carrying on business-as-usual. It has also become essential for companies to retain talent as attrition rates are going up across sectors.

Last year in July, RPG group did not give any hike, but had paid out small increments in January 2021. However, this year in July, increments were on schedule, which was 60% higher as compared to the previous cycle. The company said that the increments have been higher, where the demand for talent is more in IT.

Hikes for Aditya Birla group were varied across group companies but were higher than last year. Many factors play a role in determining compensation, but the level of uncertainty is lower this year as compared to the previous year, the company said.