India’s salary growth landscape is undergoing a significant shift, with the country’s largest metropolitan centres no longer having a monopoly over high-paying opportunities. A growing number of Tier-2 cities are rapidly narrowing the wage gap with established employment hubs, driven by manufacturing expansion, industrial corridor development and rising enterprise investments.
According to the TeamLease Jobs and Salaries Primer FY2026-27, cities such as Ahmedabad, Nagpur, Visakhapatnam and Jaipur are emerging as new salary-growth destinations, with projected increments matching — and in some cases surpassing — those of major metros.
The study, based on a survey of 1,268 businesses across 23 industries and 20 cities, analyses salary trends for entry-level roles across key sectors, including manufacturing, information technology, banking, logistics, retail, healthcare, education and financial services.
Among India’s six largest metros, Chennai is projected to record the highest average salary increment in FY2026-27 at 9.7%, followed closely by Pune and Hyderabad at 9.6% each. Bengaluru is expected to see a 9.4% rise, while Mumbai and Delhi are projected at 9.3%.
However, the report highlights a growing trend of smaller cities catching up with traditional employment centres.
Ahmedabad is expected to deliver a 9.5% salary increase, placing it ahead of Bengaluru, Mumbai and Delhi, and at par with Visakhapatnam. Nagpur follows with a projected 9.4% growth, while Jaipur is estimated to record 9.3%, putting these emerging centres on a similar footing with some of India’s most established job markets.
Manufacturing drives new salary hotspots
TeamLease said the changing salary pattern reflects a broader transformation in India’s economic and employment ecosystem. Unlike earlier growth cycles, which were largely driven by technology hiring in metros, the current momentum in several smaller cities is being fuelled by manufacturing investments, industrial expansion and enterprise operations.
“Within the non-metro landscape, a more advanced group of cities, such as Ahmedabad and Nagpur alongside Visakhapatnam and Jaipur, are becoming increasingly difficult to ignore. With increment outlook now competitive with several metros, and supported by manufacturing expansion, industrial corridor development and steady enterprise investment, they are steadily emerging as the connective layer between India’s established hubs and its next salary-growth frontier,” the report said.
The rise of these cities reflects the impact of expanding industrial clusters and companies increasingly looking beyond traditional metropolitan locations for talent and operations.
Technology metros retain premium position
While Tier-2 cities are closing the gap in overall salary growth, India’s technology hubs continue to command a premium in IT-specific compensation. Within the information technology sector, Bengaluru is projected to lead with a 12.7% salary increase, followed by Hyderabad at 11.7%, Chennai at 11.5% and Pune at 11.3%.
The report attributed the strong technology pay outlook to sustained demand from global capability centres (GCCs), technology companies and specialised digital talent requirements.
The emerging trend points towards a more distributed salary growth map, where metros continue to dominate premium technology jobs, while smaller cities become increasingly important engines of employment and wage growth.