9-10% Hikes May Not Help Beat Inflation

At a time of rising costs, will a 9-10% salary hike help much? Perhaps not, cautioned consultants working on compensation across sectors. However, companies are striving to offer tax-saving benefits and reimbursements to help increase cash-in-hand for employees and help them make the best of increased salary packages.

- Devina Sengupta & Manjul Paul

“We have always maintained that inflation, as it relates to compensation increases, is somewhat subjective. RBI’s (Reserve Bank of India’s) household inflation expectations survey shows a range of 9-9.9% in the next three months to one year. So, in the hands of the recipient, a 9% increase will be ‘felt’ as no or little real increase," said Anandorup Ghose, a partner at Deloitte India.