The Tech Salary Rollercoaster: A 5-Year Global Ride (2020-2025)
adminThe past 5 years have been a whirlwind for the global tech industry, marked by rapid innovation, shifting demands, and a fierce battle for talent. This has had a significant impact on tech salaries worldwide, experiencing both surges and stabilizations. Let's take a data-driven ride through salary trends from 2020 to April 2025.
The Pandemic Push (2020-2021): Acceleration Amidst Uncertainty
The onset of COVID-19 in early 2020 triggered a massive shift towards remote work and accelerated digital transformation across industries. This surge in demand for tech professionals, coupled with economic uncertainty, led to some interesting salary dynamics:
- Initial Hesitation, Followed by Increased Demand: While some companies initially froze hiring or introduced pay cuts, the rapid digitalization soon fuelled an unprecedented demand for software engineers, cloud specialists, cybersecurity experts, and data scientists.
- Focus on Remote-Friendly Roles: Companies looked beyond geographical limitations, opening up opportunities for talent in lower-cost-of-living areas but also intensifying global competition for specific skill sets.
- Early Salary Growth in Key Areas: Roles critical for remote infrastructure and security saw significant salary increases. For instance, cybersecurity roles globally experienced an average salary increase of 8-12% in 2021.
The Great Resignation and Talent Wars (2022): Peak Salary Inflation
2022 became the year of the "Great Resignation," with tech professionals leaving their jobs in droves seeking better opportunities, higher pay, and improved work-life balance. This intense competition for talent pushed salaries to unprecedented heights:
- Double-Digit Salary Growth: Many in-demand tech roles saw double-digit percentage increases in salaries globally. Average salary growth for software engineers ranged from 15-25% in key markets like the US, Canada, and Australia.
- Record High Offers: Companies were forced to offer significantly higher compensation packages, including signing bonuses and equity, to attract and retain talent.
- Specialized Skills Premium: Niches like AI/Machine Learning, blockchain development, and cloud architecture commanded even higher premiums, seeing salary jumps of 20-30% or more.
The Market Correction and Stabilization (2023-2024): Reality Bites
As the global economic climate became more challenging from late 2022 into 2023, the tech salary boom subsided. Mass layoffs at major tech companies and increased economic uncertainty led to a market correction:
- Slower Salary Growth: Salary growth slowed considerably, with many companies implementing more conservative compensation strategies. Average global tech salary increases dropped to the 3-7% range in 2023 and remained relatively stable in 2024.
- Increased Scrutiny on Compensation: Companies became more cautious with their compensation packages.
- Shift in Negotiation Power: The balance of power in salary negotiations began to shift slightly back towards employers.
The Current Landscape (Early 2025): A More Balanced Market
As of April 2025, the global tech salary market is more balanced, with steady 4-6% growth. Key skills (AI, cybersecurity, cloud, data science) remain in high demand with competitive pay. Total compensation packages are a major focus. Regional variations persist, with the US and Switzerland leading, followed by Australia, Canada, and parts of Europe, while Asia and Latin America are growing in competitiveness.
