The salary increment premium for digital talent dropped to 1.28x in FY24 from the highs of 1.48x in FY22—the year of the Great Resignation—and is projected to further moderate in FY25.
For the first time since the pandemic, salary increment premium for the key talent in other functions surpassed that of digital talent in FY24, according to research covering over 250 companies across sectors conducted by global professional services firm Aon, shared exclusively with ET.
The average salary increment for FY22 was 10.6% while for FY24, it stood at 9.3%. The premium-driven salary increase for digital talent was in the average range of 15% plus in FY22 and a little over 12% in FY24.
The drop in salary increment premiums for digital talent reflects a combination of market saturation and expanded talent access, leading to more balanced payouts across the digital workforce, shows research.
Organisations expanded their digital talent pools significantly in the last 2-3 years on the back of the post-pandemic tech surge, often paying over-the-top premiums to acquire and retain these professionals, resulting in inflated salary levels for this cohort. However, as the supply of digital talent has increased, and demand pressures stabilising, organisations seem to have lowered the premiums being given to this group, research revealed.
“Looking ahead, the trend in salary increment premiums for digital talent seems likely to plateau further. For 2025, the trajectory points downward. A modest decline in the differential appears probable, with salary growth potentially dipping to around 1.2x or 1.25x,” Roopank Chaudhary, partner and head of reward solutions in India for Aon, said.
This would mark a continuation of the cooling seen in recent years, driven by factors such as market saturation, broader economic uncertainties, and a rebalancing of supply and demand within the tech labour market, Chaudhary added.
Digital talent is defined as employees with skills in developing products, platforms, and solutions along with profiles in software engineering, data science/analytics and user experience.
According to the data, digital talent constituted 24.6% of the overall employee population in FY24 compared to 21.3% in FY22.
For FY24, the salary increase differential for digital talent is the highest for technology platforms and products, followed by global capability centres, and the lowest in financial institutions and life sciences sectors.
While there may be pockets of recovery in specific sectors, particularly in tech platforms and consulting, these are unlikely to reignite the rapid salary inflation of previous years.
“Instead, incremental adjustments will likely persist, as companies focus more on targeted differentiation—directing limited resources toward key talent amid constrained budgets. Thus, barring significant economic or industry-specific shifts, salary growth premiums for digital roles will likely remain subdued through 2025,” Chaudhary added.
For the first time since the pandemic, salary increment premium for the key talent in other functions surpassed that of digital talent in FY24, according to research covering over 250 companies across sectors conducted by global professional services firm Aon, shared exclusively with ET.
The average salary increment for FY22 was 10.6% while for FY24, it stood at 9.3%. The premium-driven salary increase for digital talent was in the average range of 15% plus in FY22 and a little over 12% in FY24.
The drop in salary increment premiums for digital talent reflects a combination of market saturation and expanded talent access, leading to more balanced payouts across the digital workforce, shows research.
Organisations expanded their digital talent pools significantly in the last 2-3 years on the back of the post-pandemic tech surge, often paying over-the-top premiums to acquire and retain these professionals, resulting in inflated salary levels for this cohort. However, as the supply of digital talent has increased, and demand pressures stabilising, organisations seem to have lowered the premiums being given to this group, research revealed.
“Looking ahead, the trend in salary increment premiums for digital talent seems likely to plateau further. For 2025, the trajectory points downward. A modest decline in the differential appears probable, with salary growth potentially dipping to around 1.2x or 1.25x,” Roopank Chaudhary, partner and head of reward solutions in India for Aon, said.
This would mark a continuation of the cooling seen in recent years, driven by factors such as market saturation, broader economic uncertainties, and a rebalancing of supply and demand within the tech labour market, Chaudhary added.
Digital talent is defined as employees with skills in developing products, platforms, and solutions along with profiles in software engineering, data science/analytics and user experience.
According to the data, digital talent constituted 24.6% of the overall employee population in FY24 compared to 21.3% in FY22.
For FY24, the salary increase differential for digital talent is the highest for technology platforms and products, followed by global capability centres, and the lowest in financial institutions and life sciences sectors.
While there may be pockets of recovery in specific sectors, particularly in tech platforms and consulting, these are unlikely to reignite the rapid salary inflation of previous years.
“Instead, incremental adjustments will likely persist, as companies focus more on targeted differentiation—directing limited resources toward key talent amid constrained budgets. Thus, barring significant economic or industry-specific shifts, salary growth premiums for digital roles will likely remain subdued through 2025,” Chaudhary added.
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