What is a salary hike?
A salary hike is the percentage increase in your compensation, applied during annual appraisals, on promotion, or when you switch jobs. Knowing your hike % helps you benchmark offers and negotiate confidently. A hike does not always mean a higher take-home, slab changes, restructuring of variable pay and changes in PF can move the net number.
How increments are calculated
The standard increment formula is:
Hike % = ((New CTC − Old CTC) / Old CTC) × 100
Most companies announce hikes on fixed CTC. Bonus/variable pay is usually quoted separately and is performance-linked. Always look at fixed + variable + benefits + ESOPs together when you compare offers.
Comparing a raise or offer
There is no universal good hike percentage. Compare current, dated evidence for the same role, location, experience and compensation basis. Appraisals, promotions and job changes are not directly comparable; separate guaranteed pay from variable pay and equity.
Salary negotiation tips
- Always quote a number based on your total CTC (fixed + variable + RSUs + benefits), not the recruiter's framing.
- Document achievements with measurable impact (revenue, cost saved, latency reduced, NPS).
- Benchmark using AmbitionBox, Glassdoor, levels.fyi and recent peer offers.
- Negotiate the fixed first, then variable, then joining bonus.
- If the company hits a CTC cap, negotiate ESOPs / RSUs / sign-on bonus / faster review cycle.
- Get the final offer in writing with break-up before resigning.
5-year compounding example
A ₹10 LPA salary at a steady 10% yearly hike grows to ₹16.1 LPA in 5 years. At 12% it becomes ₹17.6 LPA. The chart on the left shows your compounded growth based on the % you enter.