How salary hike is calculated
A salary hike is expressed as a percentage increase over your current salary. The formula is straightforward, as used by HR departments across Indian companies including TCS, Infosys, Wipro, and other major employers:
Increment Amount = New Salary − Current Salary
For example, if your current CTC is ₹6,00,000 per annum and you receive a 15% hike: New CTC = ₹6,00,000 × 1.15 = ₹6,90,000. Your annual increment is ₹90,000 or ₹7,500 per month.
According to Aon's Annual Salary Increase Survey, the average salary hike in India for 2026 is projected at 9.5%, among the highest globally. India has consistently maintained the highest appraisal rates in the Asia-Pacific region for 5 consecutive years, with IT/tech sectors averaging 10-12% and top performers receiving 15-25%.
Average salary hike by industry (2026)
| Industry | Average hike 2026 | Top performer hike |
|---|---|---|
| IT / Technology | 10-12% | 18-25% |
| E-commerce | 10-14% | 20-30% |
| Banking / Financial Services | 9-11% | 15-22% |
| Pharma / Healthcare | 9-10% | 14-20% |
| Manufacturing | 8-9% | 12-18% |
| FMCG / Retail | 8-10% | 14-20% |
Salary hike vs job switch
According to Naukri.com's compensation data for 2025-26, the average salary hike when switching jobs in India is 35-40%, compared to 9.5% for annual increments within the same company. In-demand roles like AI/ML engineers, data scientists, and cloud architects can command 50-80% hikes when switching employers.
However, job switching involves risks: loss of vested ESOPs, resetting of provident fund continuity, and potential probation periods. Financial advisors typically recommend switching only when the hike exceeds 30%, as smaller jumps may not compensate for these hidden costs.
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