What is the average salary hike in India in 2026?

Aon's survey of more than 1,200 organisations found an actual average increase of 9% in 2026, and companies project 9.1% for 2027. Technology consulting and services firms gave the lowest, at 6.6%.

What is India's retail inflation rate now?

CPI inflation was 6.09% in October 2026, above RBI's upper tolerance limit of 6%. It was 2.75% in January 2026 and 5.54% in September 2026.

What is the average monthly salary of a regular salaried worker in India?

According to the PLFS Annual Report 2025, men in regular wage or salaried jobs earned an average of Rs 24,217 a month in 2025 and women Rs 18,353. In 2024 the figures were Rs 22,891 and Rs 17,126.

Why do salary surveys show higher hikes than government data?

Surveys such as Aon's cover salary budgets at large, mostly organised companies for employees who stay on. PLFS averages the earnings of every regular wage and salaried worker, including those in small firms and new, lower-paid entrants.

What is the DA hike for central government employees in 2026?

Dearness allowance went from 58% to 60% of basic pay from January 2026 and to 63% from 1 July 2026. DA is revised twice a year to offset rising prices.

Do salary hikes beat inflation in India? The data

Q: Do salary hikes beat inflation in India?

In company surveys, usually yes: Aon's average hike beat consumer inflation in every year from 2022 to 2025. But official PLFS data show the average regular salaried worker's monthly earnings rose about 27.6% between July-September 2017 and April-June 2024, while consumer prices rose about 39.5%.

The short answer: It depends on whose salary you mean. Company surveys say the typical increment at large firms has beaten inflation every year since 2022, and comfortably so in 2025 [11] [12] [6]. But official data on what India’s salaried workers actually earn tell a weaker story. Between 2017 and 2024, average monthly earnings rose about 27.6% while consumer prices rose about 39.5%, a real fall of about 8.5% (our calculation) [2] [3] [4] [7] [8].

Key numbers
Average salary increase in India, 2026 (actual)	9.0% [11]
Projected increase, 2027	9.1% [11]
CPI inflation, October 2026	6.09% [16]
CPI inflation, calendar 2025 (new 2024=100 index)	About 2.8% (our calculation) [5]
Regular salaried earnings, Jul-Sep 2017	Rs 16,538 a month [2]
Regular salaried earnings, Apr-Jun 2024	Rs 21,103 a month [2]
Real change over that period	About -8.5% (our calculation) [2] [7] [8] [4]
Male regular salaried earnings, 2024 to 2025	Rs 22,891 to Rs 24,217, up 5.8% [1]

The belief, and two very different yardsticks

Every April, offices across India have the same conversation. The appraisal letter arrives, the hike is 8%, 9% or 10%, and the obvious question follows: did I actually get richer, or did prices eat it?

The popular belief is that a “normal” hike of around 9% to 10% keeps a salaried family comfortably ahead of inflation. To test it, we need two things that measure very different things.

The first is the salary survey. Consulting firms such as Aon ask companies what increase they gave and plan to give. Aon’s 2026-27 India survey covered more than 1,200 organisations across 45 industries [11]. These numbers make headlines every year.

The second is official wage data. The Periodic Labour Force Survey (PLFS), run by the Ministry of Statistics (MoSPI), asks households what they actually earn [1]. The Annual Survey of Industries (ASI) records what registered factories pay [9]. Neither is a forecast. Both cover far more workers than any company survey.

For prices we used the all-India Consumer Price Index (CPI). We used the 2012=100 series up to 2024-25 [3] [4] and the new 2024=100 series that MoSPI launched in February 2026 for later months [5]. Every “real” figure below is our calculation: nominal growth adjusted for CPI over the matching period.

What the salary surveys say

Aon’s surveys are the longest-running and most quoted. Here is what companies actually paid, set against average CPI inflation for the April-March year in which most hikes take effect.

Year	Average hike (Aon, actual)	CPI inflation, April-March	Real hike (our calculation)
2020	6.1% [15]	6.2% (2020-21) [3]	About -0.1%
2022	10.6% [13]	6.7% (2022-23) [3]	About 3.7%
2023	9.7% [14]	5.4% (2023-24) [3]	About 4.1%
2024	9.3% [13]	4.6% (2024-25) [3]	About 4.5%
2025	8.9% [12]	About 2.1% (2025-26) [4]	About 6.7%
2026	9.0% [11]	4.7%, April-October 2026 average [4] [6] [16]	About 4.1% so far

The 2025-26 inflation figure is our estimate. It averages monthly year-on-year rates from the old index for April-December 2025 and the new index for January-March 2026 [4] [5].

On these numbers the belief holds. Compound the four hikes from 2022 to 2025 and pay at the surveyed firms rose about 44%. Prices rose about 20% over the matching four years. That leaves employees roughly 20% better off in real terms (our calculation).

The exception is instructive. In 2020, the pandemic year, the average hike fell to 6.1%, the lowest since 2009 [15]. Inflation that year was about 6.2% [3]. And only 71% of companies gave any increase at all [15]. For the typical employee, 2020 was a year of standing still.

What the official wage data say

Now look at what salaried Indians actually reported earning.

PLFS: 2017 to 2024, a real decline

In an October 2025 backgrounder, the government’s Press Information Bureau (PIB) reported that average monthly earnings of regular salaried workers rose from Rs 16,538 in July-September 2017 to Rs 21,103 in April-June 2024 [2]. The same figures were widely reported at the time as a gain of Rs 4,565 in seven years [22].

That is a nominal rise of about 27.6%. Over the same quarters, the CPI rose from an average of about 134.9 to about 188.2, or about 39.5% [7] [8] [4]. After inflation, average salaried earnings fell by about 8.5% (our calculation).

Put another way, the Rs 21,103 earned in April-June 2024 bought about what Rs 15,130 bought in mid-2017. To keep pace with prices, a salary of Rs 50,000 a month in 2017 needed to be about Rs 69,700 by mid-2024. Earnings growing at the PLFS average would have taken it only to about Rs 63,800.

PIB described the rise as a sign of “higher income levels, improved job stability, and enhanced job quality” [2]. In rupee terms that is true. The real-terms picture is what the belief overlooks.

PLFS 2025: a good year, thanks to low inflation

The latest annual PLFS, for January-December 2025, was released on 27 March 2026 [1]. Men in regular wage or salaried work earned an average of Rs 24,217 a month, up 5.8% from Rs 22,891 in 2024. Women earned Rs 18,353, up 7.2% from Rs 17,126 [1].

Those are modest increases. But 2025 was an unusually low-inflation year. On the new CPI, prices averaged about 2.8% higher than in 2024, the index’s base year [5]. So men’s real salaried earnings rose about 3.0% and women’s about 4.3% (our calculation).

Notice the gap even in a good year. The surveyed company hike in 2025 was 8.9% [12]. The average salaried man’s earnings rose 5.8% [1].

ASI: factory wages, barely ahead

The Annual Survey of Industries covers registered factories. Its 2024-25 results, published in September 2026, show total wages paid to workers of Rs 3,79,768 crore, spread across about 1.67 crore workers [9]. That works out to about Rs 19,000 a month per worker (our calculation).

From 2020-21 to 2024-25, wages per worker rose about 29% while CPI rose about 24% [9] [3]. That is a real gain of about 4% over four years, or roughly 1% a year (our calculation). In 2024-25 alone, wages per worker rose 5.3% against inflation of 4.6%.

Meanwhile, net profit of the same factories rose about 88% over those four years, from Rs 6.14 lakh crore to Rs 11.56 lakh crore [9]. The total wage bill rose about 71% [9]. Much of that wage-bill growth came from hiring more people, not from paying each one much more.

Why the surveys and the data disagree

The two sets of numbers are not contradicting each other. They are measuring different people.

Who is counted. Aon surveys organised employers, more than 1,200 of them in its latest round [11]. PLFS counts every regular wage or salaried worker, including staff at small shops, schools, clinics and households [1]. Pay at a listed company and at a 10-person firm moves very differently.

Stayers versus everyone. A salary-hike survey measures what continuing employees get. An average-earnings figure changes whenever the mix of workers changes. India has been adding salaried jobs. The share of workers in regular wage or salaried employment rose from 22.4% in 2024 to 23.6% in 2025 [1]. When many new, lower-paid workers join, the average can lag even if everyone already employed got a raise.

Budgets, not individuals. Aon’s figure is an average of company salary budgets [11]. Within a 9% budget, top performers may get 15% and others 4% or nothing. In 2020, 29% of companies gave no increase at all [15].

Sector matters. Even within the survey, technology consulting and services firms gave 6.6% in 2026, while real estate and infrastructure gave 10.3% [11]. At October 2026’s inflation rate, 6.6% is barely ahead.

So the belief is roughly right for someone with a steady job at a large company. It is much less reliable as a statement about salaried India.

2026: inflation catches up

The comfortable cushion of 2025 is shrinking. CPI inflation was 2.75% in January 2026 [5]. It rose to 5.54% in September [6] and 6.09% in October, a 24-month high and above RBI’s upper tolerance limit of 6% [16] [17].

Food is the main driver. Consumer food inflation was 7.74% in September 2026, with onions up 108% from a year earlier [6]. Restaurants and accommodation were up 9.36%. Personal care and miscellaneous goods, which include jewellery, were up 13.75% [6].

Against October’s 6.09% rate, the 9.0% average hike for 2026 [11] leaves a real gain of only about 2.7% (our calculation). Aon projects 9.1% for 2027 [11]. Whether that beats inflation will depend on prices no appraisal letter can predict.

Your own inflation may differ from the headline. A household that spends heavily on food and eating out has faced higher inflation in 2026 than the CPI average. One whose biggest costs are rent, utilities and phone bills has faced less: inflation in housing, water, electricity and fuel was 2.74% in September, and in information and communication 2.44% [6].

Casual and rural workers: the weakest link

Salaried workers are the better-off part of India’s workforce. For casual labourers the picture is starker. Average daily earnings for male casual workers were Rs 456 in 2024 and Rs 455 in 2025, flat in rupees and down about 3% after inflation (our calculation) [1]. Women casual workers saw a 5.4% rise, to Rs 315 a day [1].

Over the longer run, PIB reported that casual wages rose from Rs 294 a day in July-September 2017 to Rs 433 in April-June 2024 [2]. That is about 47%, ahead of the 39.5% rise in prices (our calculation).

Recent rural wage data are disputed. Labour Bureau figures showed rural wage growth of about 17% in March 2026, against a usual 5% to 6% [19]. Dhananjay Sinha of Systematix Group argued the jump came from a change in sampling that added higher-wage regions such as Goa, Delhi and several north-eastern states [19]. He estimated underlying growth at about 4% and said Labour Bureau officials acknowledged the change in method while saying the old and new series were not directly comparable [19] [20]. Until that is settled, the rural series is best read with caution.

Two things that protect real pay, and one that may not

Government employees’ pay is linked to prices

Central government staff have explicit inflation protection. Their dearness allowance (DA) is revised twice a year using a formula based on the 7th Pay Commission’s recommendations [18]. DA rose from 58% to 60% of basic pay from January 2026 and to 63% from 1 July 2026, covering about 48.5 lakh employees and 68.7 lakh pensioners [18] [21]. For a basic salary of Rs 44,900, the July increase adds Rs 1,347 a month [18]. Most private employees have no such link.

Lower income tax raised take-home pay

From 2025-26, the new tax regime charges no income tax on income up to Rs 12 lakh a year. For salaried taxpayers the limit is effectively Rs 12.75 lakh, because of the Rs 75,000 standard deduction [10]. For many middle-income employees, take-home pay rose by more than the gross hike that year. Surveys of gross salary don’t capture this.

Labour codes could shift pay packages

Aon’s 2026 survey found 65.4% of employers already compliant with the new Wage Code and another 20.9% expecting to be ready within six months. Some 42.8% expect payroll costs to rise by at least 1% [11]. How companies restructure cost-to-company in response could affect take-home pay, in either direction, for some employees.

Verdict: myth or fact?

Partly true, but only for part of salaried India.

For employees of large, organised companies: mostly true. Average surveyed hikes beat inflation every year from 2022 to 2025, by roughly 4% to 7% a year in real terms [12] [13] [14] [3]. The exception was 2020, when hikes merely matched prices [15].
For the average salaried worker: mostly false over the long run. PLFS data show real monthly earnings fell about 8.5% between mid-2017 and mid-2024 [2] [4]. Factory wages per worker barely beat inflation from 2020-21 to 2024-25 [9].
In 2025: true almost everywhere, because inflation was unusually low [1] [5].
In 2026: the margin is narrowing fast, as inflation climbed from 2.75% in January to 6.09% in October [5] [16].

A 9% hike only means something next to the inflation of the same year, and next to the hikes others are actually getting. The headline survey number describes a budget at large firms. The official data describe India.

An explainer for general reading, based on public records as of 12 November 2026. Not investment, tax or legal advice.