India’s tech pay plunges 40% as US engineers strike gold in the AI boom
The paychecks that once symbolised India’s ascent as a global technology hub are shrinking, sharply. According to a joint report by payroll and compliance platform Deel and equity management firm Carta, median compensation for engineering and data roles in India has nosedived by 40%, plunging to $22,000 in 2025 from $36,000 a year earlier. In sharp contrast, their counterparts in the United States have seen salaries soar by 23%, reaching record highs as tech firms there recalibrate to retain scarce talent in an AI-driven economy.The findings reveal a widening chasm between two geographies that once marched in step during the digital boom. The pandemic-era surge in global remote hiring and dollar-linked pay scales has now given way to corrections in emerging markets like India, where cost rationalisation and hiring freezes have curbed compensation growth. Meanwhile, in the US, a battle for top-tier engineers and data scientists, especially in AI, cloud computing, and cybersecurity, continues to drive compensation upwards, despite broader economic caution.
India’s decline: From tech powerhouse to cost correction zone
The report’s data paints a sobering picture of India’s tech workforce. Engineering and data professionals, once the poster children of the country’s IT success story, are now bearing the brunt of global recalibration. Deel and Carta’s joint analysis shows that median compensation for engineering and data roles has dropped 40% in just a year, a steep fall rarely seen in India’s thriving digital economy. Experts attribute this decline to shrinking global remote contracts, the return of in-office mandates in Western markets, and a sharp correction in startup valuations, which has eroded equity-linked pay components. The sentiment reflects a broader shift, from exuberant hiring during 2021–22 to pragmatic scaling in 2024–25.
Meanwhile, in the US: Tech talent becomes gold
Across the Atlantic, the story unfolds in stark contrast. Median compensation for US-based tech professionals surged 23% in 2025, according to Deel and Carta, as competition for specialised roles intensified. With artificial intelligence reshaping industries, companies are racing to recruit engineers proficient in large language models, data architecture, and machine learning deployment. The result? A bidding war that has sent wages soaring, especially in top-tier hubs such as San Francisco, Austin, and New York.The rise in compensation underscores the paradox of a market where automation displaces some roles even as it inflates the value of others.
Gender parity: India’s quiet strength amid the storm
While India’s compensation figures have dipped, the country has quietly achieved what many Western economies still struggle with: Near gender pay parity in tech. The Deel–Carta report observed that our country has demonstrated near parity in tech roles, with sales accomplishing full gender equality.
The future of tech work: Diverging realities
The emerging divide between India and the US is more than just a reflection of macroeconomic forces; it is a signal of how the global geography of work is being redrawn. For India, the short-term pay decline could lead to long-term resilience, as companies restructure compensation models toward sustainable, performance-linked pay rather than inflated global parity. For the US, the escalation in wages is both a boon and a warning, fueling innovation yet also intensifying cost pressures in an already expensive labour market.As the dust settles on a year of economic realignment, one truth stands out: The digital economy’s backbone, its people, are no longer moving in unison. The pay packets of coders, designers, and data scientists have become the new fault lines in a world still trying to balance ambition with affordability.
