Increment Strategy ppt 2012-13 : Play this in slide show mode
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The Indian economy grew at 6.28% in FY 2011-12 but slowed to an estimated growth rate of 5% in FY 2012-13, below the budgeted rate of 7.6%. Inflation increased over this period from 8.4% to 10.44% while industrial production and FDI declined. The mining and metals sector saw negative growth of 2.01% and 2.33% respectively over the two fiscal years. Salary increases across sectors averaged 12% in FY 2012-13, with manufacturing seeing the highest at 15% and financial services the lowest at 10%, as the economy faced challenges of inflation and slowing global growth.
Increment Strategy ppt 2012-13 : Play this in slide show mode
- 2. Broad Outlook—Indian Economy FY 2012-13 GDP Growth rate April 2011 to March 2012 : 6.28% April 2012 to March 2013 : 5% Index of Industrial Production Growth April 2011 to March 2012 : 3% April 2012 to March 2013 : 1.16% Growth of Mining & Metal April 2011 to March 2012 : - 2.01% April 2012 to March 2013 : - 2.33% FDI 2012-13 USD 22.42 billion versus USD 35.12 billion in FY 2011-12 (i.e. -38%) Inflation (Consumer Price Index) April 2011 to March 2012 : 8.40% April 2012 to March 2013 : 10.44%
- 3. The top 10 business risks for Mining and Metals 1. Resource nationalism 2. Skills shortage 3. Infrastructure access 4. Cost inflation 5. Capital project execution 6. Maintaining a social license to operate 7. Price and currency volatility 8. Capital management and access 9. Sharing the benefits 10. Fraud and corruption
- 4. Overall Industry Analysis : FY 2012-13 • India has strong growth fundamentals but faces challenges in the form of a volatile global market coupled with issues of fiscal consolidation and inflation. Upside risks to inflation expected from fiscal slippage, currency depreciation and commodity shocks • Policymakers struggled to strike a balance between inflation and growth. Domestic growth rate was impacted by tightening of the monetary policy by RBI and geopolitical concerns • The Indian economy faced twin macroeconomic challenges of managing growth and containing inflation during the fiscal 2012-13 against a backdrop of an uncertain global environment • In response to global economic issues such as Eurozone crisis and rising commodity prices, fiscal year 2012 - 2013 saw the Indian economy slow down • The budget pegged Gross Domestic Product (GDP) for the year 2012-13 was at 7.6% while it is actually 5% • The Wholesale Price Index (WPI) inflation for all commodities for the period of April 2012 to March 2013 was 7.3% • Inflation in Consumer Price Index was 10.44 % in 2012-2013 • A slowing global economy continues to have an impact on the Indian Economy. According to the RBI, the world economy may observe a decline in its growth trajectory although it is not slated for another recession
- 5. Industrial Growth Rate trends
- 6. Industrial Growth – Overall & Broad Sectors
- 7. Momentum of IIP (Manufacturing) Gross capital formation (GCF) in the industrial sector comprising mining, manufacturing, electricity and construction recorded an average growth of 13.2 per cent during 2012-13.
- 8. Job Projection 2013-14 Job growth is occurring across most sectors and the employment outlook for 2013- 2014 is encouraging. Our annual employment survey reveals 58% of employers anticipate an increase in staff numbers over the next 12 months. This positive outlook in recruitment has been driven by global companies looking at India as a core growth market given the ongoing uncertainties in the US and European economies. India is regarded as a logical business hub with a well qualified young workforce and the required infrastructure to support international business activities. Predicted Employment for 2013-14 Increase Decrease Stable
- 9. Salary /Increment Survey Highlights FY 2012-13 • Overall median salary increase across sectors is 12% • Manufacturing industry including Mining, Steel and Cement have reported highest increment figures for 2012 - 2013 at 15% • Financial Services sector has been most conservative in increment projection for 2012 2013 at 10% • The overall attrition across industries is 13%. Better Pay and Personal Reasons have been rated as the key reasons for attrition industry-wide • Hiring and Retaining skilled talent continues to remain a key challenge in the market • Sectors which have registered highest attrition are ITeS, Pharmaceuticals, Healthcare & Life Sciences and Media & Advertising and the sectors which have registered lowest attrition are Manufacturing and Energy & Resources • Organizations are also keenly adopting cost optimization measures. Offshoring / Outsourcing of activities have been rated highest amongst measures adopted. • Interestingly employers are not keen on reducing spend on “Recognition Programs” or “Training programs”
- 10. Salary Increment Scenario India Inc is increasing employee salaries by a modest 6-13 per cent this year. In sectors such as IT and telecom, which are facing a bad year, the wage hike is being pegged at around 7-8 per cent, while companies in recession-free sectors, such as the Mining, pharmaceutical industry, are offering increases of 12-13 per cent.
- 11. Annual Increment Trends Overall Industry Analysis Increments are expected to be conservative, attributable to the overall economic conditions Year 2011-12 2012-13 2013-14 Average Increment 13.00% 12.00% 11.30% Average Increment 13.50% 13.00% 12.50% 12.00% 11.50% 11.00% 10.50% 10.00% Average Increment 2011-12 2012-13 2013-14 Mining and Manufacturing Increment Analysis Average Increment Year 2011-12 2012-13 2013-14 Average Increment 12.30% 15.00% 11.20% 20.00% 15.00% 10.00% Average Increment 5.00% 0.00% 2011-12 2012-13 2013-14
- 12. Overall Industry Analysis Annual Increment • Annual median increment for 2012 - 2013 across all sectors is 12% • Manufacturing industry including Mining, Steel and Cement has the highest increment figures at 15% and Financial Services sector has the lowest increment figure at 10% • Financial services sector maintains a conservative estimate given the overall mood of the economy • Infrastructure & Real Estate‟, ―Pharmaceutical and Healthcare & Life Sciences‟ have reported the same increment figures as last year • ITeS sector has seen the steepest drop in salary projections despite the attrition challenge faced by the industry • Interestingly, in most organizations employers are aware that most employees leave for better pay elsewhere however they have either the same increment or lower increments as compared to last year