Stagnant salaries: A decade of flat growth for IT Freshers in India

The trends in fresh graduate compensation over the past decade indicate the stagnation of entry-level salaries in the Indian IT sector, particularly within the IT services group. According to data, over this period, the average increase in salary offers has been just over ₹1 lakh per year (LPA).

Data from specialist staffing company Xpheno revealed that in 2013-2014, engineering freshers received offer packages ranging from ₹3 to ₹3.4 LPA. A decade later, in 2023-24, this growth remained flat, with packages only increasing to ₹3.8 to ₹4.5 LPA.

“Stagnation of fresher salaries in the IT sector, specifically IT services cohort as the largest consumer of talent, is evident from the decade’s trend on fresher packages in the offering. The oversupply of talent at the bottom of the tech pyramid and rising enterprise training costs to prepare them for the job will continue to keep compensation packages stagnant or with minor movements, if any,” said Prasadh M S, Head of Workforce Research at Xpheno.

Sarbojit Mallick, Co-founder of hiring platform Instahyre, noted that fresher salaries have mostly stood still across job functions and showed dips from 2023 to 2024 for certain skills in popular tech domains.

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For example, in Frontend programming skills, React.js salaries fell by around 1.5 LPA for employees with up to 1 year of experience. In Data Science, freshers’ salaries for Machine Learning & Natural Language Processing skills fell by 5 percent due to a higher supply of graduates specialising in them, without an increase in companies’ uptake of inexperienced talent, he pointed out. Similarly, for App Development, average salaries for up to 1 and 2-5 years of experience fell by around 3 LPA but rose by around 5 LPA for those with 6-9 and over 10 years of experience.

“Companies are more eager to hire and retain seasoned tech talent rather than invest in training freshers,” he said.

On the other hand, the same was not true for CEOs of such companies. According to the Deloitte India Executive Performance and Rewards Survey 2024, the average CEO compensation stood at ₹13.8 crore, up 40 percent compared with pre-COVID-19 levels. Every second CEO had a target compensation of more than ₹10 crore in 2024, compared with every third CEO in 2020.

In FY14, former Infosys CEO Shibulal earned ₹16 LPA, whereas in FY24, current CEO Salil Parekh’s salary soared to ₹66 crore, marking a substantial increase over the decade. HCL tech CEO C. Vijayakumar received ₹84.16 crore in FY24, compared to former CEO Anant Gupta’s ₹4.22 crore in FY14. Former Wipro CEO T K Kurien was paid ₹6.57 crore in the same fiscal year, while current CEO Srini Pallia earned around ₹50 crore. The former TCS CEO earned ₹1.31 crore, while the current one received approximately ₹25 crore.

Mallick also noted that as the distance between current work behavior and future rewards increases, the positive effect of the appraisal on motivation weakens. “Delayed performance appraisals can negatively impact employee performance, including reduced performance, motivation, and momentum. Employees may become risk-averse and avoid potentially risky moves they might have otherwise attempted to earn monetary rewards.”

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Aditya Narayan Mishra, the MD & CEO of CIEL HR said, “In the IT Sector, where professionals often seek growth both in role and remuneration, delays may lead to workforce disengagement. Employees may feel disappointed and potentially undervalued, reducing productivity and leading to higher attrition rates.”

Top talent thrives on growth and recognition, he commented. When faced with stagnation, they’re more likely to be restless and potentially explore other opportunities.

“Extended periods of uncertainty can erode trust and loyalty, potentially triggering a talent exodus. However, companies that communicate transparently, provide alternative recognition, and offer skill development opportunities can retain their high performers. Employees also understand the current market reality, and many may avoid hasty job changes, balancing their decisions with the broader economic context.”