IT services industry in India is expected to keep the salary hike expectations moderate in the fiscal year 2025 as the organizations struggle with the economic downturn and new challenges posed by the AI. It is expected that the average salary growth will be between 4% and 8.5%, which is quite lower as compared to the previous years.
In the view of Krishna Vij, the Vice President of TeamLease Digital, the analysis is quite conservative. She pointed out the reasons for the slowdown to include global economic risks, constrained expenditure, and changing business strategies. Some companies have even extended their appraisal timelines beyond the normal April-June timeframe, which makes it difficult to determine the salary trends.
In contrast to the regular increases in salaries, companies are now providing one-time retention bonuses, ESOPs, and project-specific payments. The trend is also visible towards paying employees on the basis of skills and increasing the recruitment from Tier 2 cities to reduce the cost.
Reed & Willow’s CEO, Janoo Motiani, also provided similar estimates, expecting increases between 5% and 8.5%. “It looks like double-digit hikes are finally over, at least for the time being,” she said. Other companies like TCS have also announced that they will be increasing the salaries of their employees by 4% to 8% from April 2025 and other firms like Infosys, HCLTech, Wipro, and Tech Mahindra are yet to announce their decisions.
The increases will differ according to the position and skills anticipated. Recent graduates may expect raises of 2% to 4%, while mid-career workers in sought-after fields such as AI and cybersecurity could get raises of 10% to 12%. Leadership positions and technical specialists will be offered rises of up to 15% due to their critical functions.
