India salary hikes to stabilise at 8–12% in 2026: Which skills can fetch up to 30%?

India’s salary growth is expected to settle into a more moderate 8–12% range in 2026, even as professionals with specialised technical and leadership capabilities continue to command significantly higher increments, according to the Michael Page India Salary Guide 2026.

The report said salary movements have stabilised after several years of rapid growth, pointing to a more balanced labour market. However, this moderation does not apply uniformly across skills and sectors. Professionals with expertise in artificial intelligence (AI) and machine learning (ML), semiconductors, renewable energy, automotive and battery technologies can command salary increases of up to 30% when changing jobs.

AI, semiconductors emerge as premium skills

The premium for specialised talent reflects growing demand for capabilities linked to technology-led industries. The report identifies AI and ML, semiconductor technologies, renewable energy, automotive and battery technologies among the areas where companies are competing for specialised professionals.

The trend is particularly visible in engineering and manufacturing. India is increasingly becoming a strategic hub for global engineering and manufacturing, with multinational companies expanding engineering and research and development centres in states including Karnataka, Telangana, Maharashtra, Gujarat and the National Capital Region.

The sector has also seen a sharp rise in demand for niche skills in semiconductors, electric vehicles and renewable energy. Companies are addressing talent shortages by recruiting internationally or upskilling professionals from adjacent industries.

MUST READ: Looking for your next job? These sectors are driving India's 14% hiring growth. Check the full list here

Leadership skills gain importance

While technical expertise remains critical, the report said commercial acumen is becoming increasingly important for senior leadership appointments in engineering and manufacturing. Employers are also looking for professionals capable of managing greenfield and brownfield projects, external stakeholders and new product development programmes.

Across the broader labour market, leadership capabilities and niche technical expertise are expected to remain particularly valuable. The report also highlights strong demand for professionals in digital, engineering and business-partnering corporate functions.

GCCs remain a major hiring engine

Global Capability Centres (GCCs) are another key driver of employment. The report said these centres have evolved beyond traditional shared services and are increasingly involved in innovation, analytics and product development, strengthening India’s position as a global talent hub.

The salary outlook therefore points to a two-speed market in 2026: general annual increments are expected to remain within the 8–12% range, while professionals with scarce technical capabilities and leadership expertise may see substantially higher pay increases when switching jobs.

ALSO READ: Gen Z drives 79% of new formal job accounts in India in FY26: Quess report

TeamLease data shows sharper premium for specialised skills

The trend is also visible in TeamLease’s latest hiring data, which points to a much wider gap in salary growth between premium and broad-based roles. Employees earning ₹20 lakh and above are seeing salary hikes of nearly 18% year-on-year, compared with around 6–6.8% for roles below ₹20 lakh.

The premium becomes even more pronounced at the top end. Professionals with specialised skills in the ₹50 lakh-plus salary bracket are seeing hikes of 40–45%, according to the data. The strongest demand is concentrated around cloud management, semiconductors, cybersecurity, AI and ML, and data roles.

TeamLease also reported that overall hiring increased 14% year-on-year in August, signalling an improvement after a prolonged period of subdued hiring. IT services, GCCs and business process outsourcing firms have seen a pickup, while hiring in traditional mid-level coding and testing roles remains under pressure as companies increasingly adopt AI tools.

The TeamLease findings reinforce the broader picture emerging from the Michael Page report: salary growth is becoming increasingly skill-dependent, with specialised technology capabilities attracting a significant premium even as average increments moderate across the wider job market.

DO READ: BT Big Story: Why India Inc is warming up to non-English-speaking executives