Is 2022 the year of jobs & salary increments? How? For Whom?

KAKALI DAS

Is 2022 the year of jobs & salary increments?

The increment season is upcoming. This may be the highest salary hike since 2016! But bad news is that the increment is only for the deserving people, and not for the entire lot. Let’s uncover the type of people who will steal bulk of the increment!

This year salary hikes are expected to be 9-10% which is better than pre-pandemic, as analysis of 1500 companies by HR firm revealed, highest since 2016. The talent assessment firm, Mercer’s report is along similar line – 9.9% salary hike. So, finally no more waiting for acche din in terms of increments. But it will depend on person to person.

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Survey by Aon India shows that 33% companies will give 10% increment in 2022. Number of companies going for zero increments is only 0.3%. Moreover, companies are willing to give higher % increments, where 10% is average. 46% companies will give 8-10% increment in 2022. And 32% of the companies are making increments more than 10%.

We all know that the pandemic has seriously impacted jobs and salaries. But despite pandemic, India’s situation is better than other countries. This is evident among BRIC countries like Brazil, Russia, India, China – Brazil in an increment of 5%, Russia 6.15, China 6%, and India with 9-10% average increment.

The increment in the pay checks in the USA is of 3.6%, and UK, Germany, Japan, Singapore are 3%, 3%, 2.9% and 4% respectively. The condition of India in comparison with these countries is considerably better.

Is 2022 the year of jobs & salary increments? How? For Whom?

What is the reason behind this high increment this year?

The Great Resignation – One factor is to avoid the great resignation, a tsunami of people quitting their jobs, for one reason or the other since the onset of the pandemic. This is the highest attrition over the last two decades, and hence the raise, to retain the efficient working population. Attrition across sectors is of 21% in 2021 compared to 12% in 2020; people quitting jobs are reported to have doubled in a year. People are quitting to cash in their newly acquired skill.
Business Optimism – Second factor for increment as reported is, business optimism – the future of business. 88% of the respondents are optimistic regarding the improvement of business outlook even after so many variants in pandemic. This very sentiment was 36.8% in 2020, 77.5% in 2021 and 88.7% in 2022. Only 9.7% companies see no impact on business and 2% expect decline.

Sectors and Projected Salary Hikes in 2022

E-commerce – 12.4%
Hi-Tech/IT – 11.6%
Professional Services – 12.9%
IT Enabled Services – 10.7%
Entertainment/Gaming – 10.2%
Life Sciences – 9.6%
Metal/Mining – 8.3%
Restaurants – 8.5%
Cement – 8.6%

These are the average estimates of a few sectors. The above mentioned percentages are lowest salary hikes as an industry, and not as individual performances. (source- AON India)

The moral of the story is that skills are the key to increment. As per Mercer, niche skill sets are high in demand as the business landscape is changing drastically. For example, JavaScript or SQL developers will be the coveted roles in 2022. Network security, cloud adoption which could enable companies will forever be in demand. Digital niche and super niche skills’ demand surge in this year.

According to the World Economic Forum, “65% of children entering primary school today will ultimately end up working completely new job types that doesn’t yet exist.” So, imagine how rapidly the job market is evolving. As a result of which, Google has recently taken a decision to launch their new Google Cloud Skills programme that aims to train 40 million people to evolve them with the changing times and get learners to be future-ready to match employability requirements.

Upskilling is the key to success in ever evolving world. Unlearn, relearn, reskill, upskill are of utmost importance in today’s professional world. For example, Data Science area is tending, and data volume is expected to cross 149 zettabytes worldwide by 2024. An interesting fact – from 2 zettabytes, a decade ago, it increased manifold in 10 years. Only a professional can extract valuable points from large data. Cutting edge technology courses like Artificial Intelligence (AI), Data Science, machine learning are not readily available at traditional school systems in India.

Machine learning is a desired skill as companies switch to automation. Machine learning can help in achieving that. Full stack coders, cyber security, robotics, cloud computing, block-chain and many other boom areas are in high demand in every industry growth but people with such skills are few.

The Negative Impact

Inflation will severely impact increment. In January 2022, Consumer Price Index (CPI) has risen to 6.01%, highest in seven months. So, if you receive 9-10% hike amid 6% inflation then overall it amounts to only 4%. Thus, inflation eats up hikes.

Experts say that inflation is one of the biggest concerns in 2022-2023, and government, companies have to find a way to grapple with it, otherwise economy will suffer again. The price of sugar, flour, milk have increased 25% in the past few months.

And internationally, crude oil crosses 100$; price of fuel will seemingly rise after election. So, purchasing capacity will decline, and next year increment is also at risk. Situation is not so rosy as it may seem for a few industries. Whereas, few others which are relevant will take home bulk of increment.

Skills to generate Employability

On the flip side, the government is looking to generate employment at any cost. In the budget 2022, 6 million jobs have been promised over the next 5 years.

But, how it will be achieved is ambiguous yet. Economists and journalists on ground report that an entire generation is jobless, hopeless waiting for govt. jobs. This generation is named as “nowhere generation”. The future seems to be at stake for this generation.

I urge you not to be a nowhere generation. Years go by, waiting for government jobs. Recently, for a railway post, 1.2 crore candidates applied for 35,000 posts. Protests stopped after govt. assurance, but 1.2 crore is a huge number; it is 10% of our population in between the age group of 20-25 years. They are competing for 35,000 vacancies which is also the lowest level of entrance in the railways. Such is the situation of joblessness. The problem of un-employability cannot be denied.

Period Labour Force Survey (PLFS) has revealed that the unemployment rate among 18-25-year-olds in India, at almost 25% even before the pandemic, has been one of the world’s highest if small and conflict ridden countries are excluded.

Now, the government too have understood that degrees merely won’t help, and that digital university can solve issue of limited seats in colleges. The government acknowledges the need to skill youth. UGC reforms: Edtech firms can tie up with universities to develop e-courses.

In the end, the future of technology is evolving as we speak. According to a survey by the Federation of Indian Chambers of Commerce & Industry (FICCI) in 2021, at least 9 per cent Indians will be in jobs that don’t exist currently, and 37 per cent of the workforce will require radically changed skill sets to meet their employability demands. And now, after pandemic it is all the more important to upskill.

Be relevant.

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