India’s Global Capability Centres (GCCs) are projected to give an average salary hike of 9.9 percent in FY25, according to a detailed report by Talent500, a hiring platform operated by ANSR. This projected hike not only surpasses the 8.1 percent hike anticipated by IT services firms but also represents a slight increase from last year’s GCC increment of 9.7 percent.

The study reveals how GCCs have transformed from back-end support arms into strategic global hubs, thereby requiring superior talent retention and compensation strategies to stay competitive.

Retail, CPG, and Healthcare GCCs Lead Salary Growth

Among various industry sectors, retail and consumer packaged goods (CPG) GCCs will witness the highest average salary increment of 10.4 percent, followed closely by healthcare and life sciences GCCs at 10.1 percent. Other key sectors include:

• Travel and transportation GCCs at 9.8 percent

• Banking, Financial Services and Insurance (BFSI) at 9.6 percent

These numbers indicate that industry-specific demand for specialized skills is directly influencing salary increases.

IT Services Firms Lag Behind

In contrast, traditional IT services companies are expected to offer a comparatively lower salary increment of 8.1 percent, which is only a modest improvement over their 7.4 percent hike in FY24. This widening gap highlights the growing prominence of GCCs in India’s tech and business ecosystem.

Voluntary Attrition Declines Due to Better Employee Experience

One of the more encouraging signs from the Talent500 report is the sharp decline in voluntary attrition among GCCs — from 16.9 percent in FY24 to 12.6 percent in FY25. This is attributed to:

• Focused investments in career development

• Efforts towards culture building

• Enhanced employee experience

These initiatives are positioning GCCs as desirable workplaces for top talent.

Rise in Non-Merit-Based Salary Increases

Another trend observed in the report is the increase in non-merit salary hikes, which are not tied to individual performance but are instead driven by:

• Inflation adjustments

• Cost of living increases

• Market correction strategies

Such hikes ensure GCCs remain competitive in a tight labor market where retaining talent is critical.

Emphasis on Long-Term Incentives (LTIs) and Stock-Based Benefits

More than 70 percent of GCCs now offer Long-Term Incentives (LTIs) to employees as part of their compensation packages. These LTIs include:

• Employee Stock Option Plans (ESOPs) – Dominating with 71 percent adoption

• Restricted Stock Units (RSUs) – Account for 20 percent

• Stock Appreciation Rights (SARs) – Represent 8 percent

These are not just tools for wealth creation, but also to enhance employee ownership and ensure their goals align with strategic business outcomes.

AI and Analytics Reshaping Compensation Strategy

An important evolution highlighted in the report is the use of artificial intelligence and analytics in driving smarter compensation decisions. GCCs are employing these technologies for:

• Real-time pay equity audits

• Personalized rewards systems

• Agile and data-driven talent strategies

This tech-driven approach ensures fairness, transparency, and agility in managing employee compensation and engagement.

Boost in Variable Pay Linked to Performance

There is also an upward trend in actual variable payouts, reflecting stronger organizational and individual performances. The numbers speak for themselves:

• In FY23, variable pay formed 11.2 percent of the total salary

• For FY25, this is expected to rise to 13.9 percent

The increase is seen as a positive performance indicator and further encourages employees to remain goal-oriented and productive.

What This Means for the Future of GCCs in India

The Talent500 report paints a picture of an evolving GCC ecosystem that is increasingly becoming strategic, agile, and employee-focused. The key takeaways include:

• Competitive compensation models that now include non-merit hikes, ESOPs, RSUs, and SARs

• Adoption of AI tools for fairer, smarter salary decisions

• Stronger focus on retention through culture and development

• A sustained push towards performance-driven rewards

As GCCs continue to grow their footprint in India, their role in the global enterprise strategy will only expand. The findings also suggest that employees in these centers will increasingly benefit from structured compensation models that recognize performance, potential, and market dynamics.

Conclusion

India’s GCCs are not only outpacing IT services firms in salary hikes, but they’re also redefining what it means to attract, retain, and reward talent in a highly competitive market. With stronger long-term incentives, declining attrition, and smarter compensation strategies, the GCC talent landscape is set for robust, sustainable growth in FY25 and beyond.

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