Tier-2 cities narrow salary gap with Metros: Report
Kochi, Thiruvananthapuram, Thane, Surat, Jaipur, and Indore emerge as high-growth tier-2 talent hubs
India’s compensation landscape is entering a new phase of maturity, marked by salary stability, strong demand for niche skills, and the rapid rise of tier-2 cities as credible, high-paying talent hubs, revealed the latest Randstad Annual Salary Trends Report 2025–26.
Despite a year marked by economic and geopolitical volatility, tier-1 salaries have shown notable resilience, stabilising at a national average of Rs 5.92 lakhs (junior), Rs 16.70 lakhs (middle), and Rs 32.40 lakhs (senior). This trend signals a strategic recalibration by organizations, moving away from uniform salary hikes towards targeted, data-driven rewards frameworks that balance compensation with productivity, skills development, flexibility, and workforce well-being.
One of the most striking findings from this year’s report is the significant surge in senior-level salaries in tier-2 cities, where the average CTC has risen to Rs 28.38 lakhs, with the top two tier-2 locations now offering compensation comparable to tier-1 cities. Tier-2 cities are fast emerging as domain and industry-led Global Capability Center (GCC) hubs, driving demand for leadership, niche domain expertise, and advanced technology skills, and compelling organizations to pay competitively.
The insights also point to the growing prominence of Kochi, Thiruvananthapuram, Thane, Surat, Jaipur, Vadodara, Bhopal, and Indore as future-ready tier-2 locations, supported by infrastructure investments, progressive state policies, accelerated digital transformation, advanced manufacturing growth, and dedicated GCC and startup setups.
From an industry perspective, IT commands the highest salaries across all levels, with average CTCs of Rs 6.65 lakhs (junior), Rs 20.75 lakhs (middle), and Rs 35.66 lakhs (senior). Demand for skills in AI/ML, cloud computing, cybersecurity, data, and DevOps continues to outpace talent supply, pushing organisations towards skills-based pay and performance-linked incentives.
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