New Delhi, Jul 11 (IANS): Companies will look at paying more and hike their employee headcount as most expect business to grow significantly in 2011, according to a survey released by a global human resource consulting firm Monday.

There is optimism displayed by 84 percent respondents as they expect business performance to increase significantly in 2011. Organisations surveyed expect a 12.7 percent average salary increase for all employees across industries in 2011, according to Mercer's survey of HR leaders representing 91 firms across various industry sectors.

"Survey findings also reveal that 94 percent respondents indicate aggressive recruiting for new positions and attrition backfill," said the report.

The survey, by Mercer India Monitor, is conducted quarterly and focuses on HR budgets and inflation.

Among different industries surveyed, projected salary increase for the automobile industry is highest at 14 percent followed by consumer at 13.8 percent, chemical and manufacturing both at 13.4 percent. Employees in IT & Telecom sector are expected to receive a relatively lower salary increase at 11.8 percent compared to other industries.

"On the backdrop of a growing economy, overall expectation on business performance is still quite positive with various industry sectors experiencing good growth. This trend explains the return of the war for talent with an increase in salary increments, hiring and an increased proportion of employee salaries in the HR Budgets in 2011," said Shamita Chatterjee, Mercer's India business leader for information product solutions.

"Recruitment and training budgets are also expected to increase in proportion this year. As thought leaders in human capital strategies, Mercer conducts market research on people practices and Mercer India Monitor is a key pulse survey-based endeavour," said Chatterjee.

The survey also found that 94 percent of the respondents were looking to ramp up recruitment activities, while only six percent looking at maintaining the same level of headcount in 2011. About 67 percent of the survey respondents indicated that they are hiring people for new positions as well as filling vacant positions.

Rising inflation also has had a impact on employee allowances with 43 percent of the respondents saying that they are planning to help employees deal with rising costs.

"An encouraging number of respondents have increased travel and fuel reimbursements for their employees to assist them in managing rising costs, 38 percent of the survey respondents have given an additional salary increase of over 5 percent on account of inflation."