AI Pay Gap Widens: New Hires Earn More Than Existing Employees

A new Indeed report has unveiled a widening gap between what employers say they pay for AI talent and what existing employees actually receive.

While companies are offering significant salary premiums to attract AI-skilled professionals, many employees who have already upskilled report little or no improvement in their compensation.

The findings come from Indeed’s inaugural AI at Work Tracker 2026, based on a survey of 1,267 employers and 2,541 employees across India.

Employers Pay More for New AI Talent

According to the report, 66% of employers said they offer higher salaries for AI-skilled roles, with many paying 11% to 30% more than comparable non-AI positions.

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Additionally, 26% of employers reported salary premiums ranging from 31% to 50% for AI talent. However, employees already working in AI-related roles paint a different picture. Among AI-exposed employees:

36% reported no change in compensation over the past year.
18% said their earnings had declined.
Only a small percentage received salary increases comparable to those being offered in the external job market.

Retention Challenges Could Grow

The report suggests that companies are investing heavily in attracting new AI talent while internal compensation for existing employees is not keeping pace.

This could create retention challenges as professionals who have developed AI capabilities look for better-paying opportunities elsewhere.

Sashi Kumar, Managing Director of Indeed India, said organisations need to align their appraisal and reward systems with the value created by employees who have successfully upskilled in AI.

AI Is Changing Jobs Gradually

Despite growing AI adoption, the report indicates that workplace transformation remains gradual rather than disruptive.

11% of employees said AI has completely transformed their role.
65% reported moderate or incremental changes in their work.
Nearly one-fourth said AI has not changed their job so far.

The findings suggest AI is being integrated into existing workflows instead of replacing roles overnight.

Skills Matter More Than Degrees

Hiring practices are also evolving toward a skills-first approach.

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Nearly 40% of employers now prioritise AI skills and certifications over university degrees when hiring for AI positions, while only 9% continue to rely primarily on academic qualifications.

Employees are noticing the same trend:

37% believe employers now value skills and degrees equally.
31% feel AI skills carry greater importance than formal qualifications.

The report also found that more than half of employees now identify themselves by their skills and learning ability rather than their job title, reflecting a shift towards continuous learning in the AI era.

AI Hiring Continues to Grow

Despite concerns around AI’s impact on careers—with 42% of respondents expressing anxiety, particularly among unemployed job seekers—demand for AI talent continues to rise.

According to the report, 63% of employers increased hiring for AI-related roles during 2025 compared to the previous year.

Rather than a hiring boom limited to AI engineers, organisations are steadily expanding AI capabilities across functions including AI strategy, operations, governance, ethics and engineering as they integrate AI into their existing workforce.

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