AI Salaries Surge 22% in Two Years; IT Pay Stagnates

India's compensation landscape is diverging sharply, with AI leading salary growth at 12% year-on-year, followed by cybersecurity and semiconductors at 9% each, according to the foundit Insights Tracker. Over two years, AI salaries have compounded 22%, while IT services pay stagnated and sectors like e-commerce and hardware saw declines. Entry-level AI professionals earn between ₹8.87 and ₹15.41 LPA, nearly three times the starting pay in IT services, and senior AI roles in Bengaluru command premiums of up to 40% over Chennai. The data underscores a market where employers are paying selectively for scarce skills that fill capability gaps, rather than rewarding experience alone. Key signal: AI salaries in India grew 12% year-on-year and 22% over two years, while IT services pay stagnated and entry-level IT salaries are about a third of AI freshers' pay. For hiring leaders, this matters because for CHROs and TA leaders, this signals a critical shift: the premium is on specialized AI skills, not general IT experience. The widening pay gap between AI and traditional IT roles will intensify talent wars for AI specialists, while making it harder to retain or attract talent in legacy IT roles. Geographic disparities mean companies in Tier-2 cities can access AI talent at lower costs, but senior expertise remains concentrated in metros like Bengaluru and Hyderabad. This data should inform compensation benchmarking, workforce planning, and strategies for upskilling or reskilling existing IT staff to bridge the AI capability gap. Teksands view: Stop benchmarking against stale IT pay scales. The market is paying a 3x premium for AI skills at entry level, and that gap will only widen. If you're not building an AI talent pipeline now, you'll be overpaying later. Also, consider Tier-2 locations for cost-effective AI hiring, but be prepared to invest in senior leadership there.