Software engineer salary trends in 2026: Average salaries, differences per country, and AI premiums

What should you be paying your Software Engineers? How do salaries compare across European markets? Are you staying competitive with the market rate in 2026?

For People and Reward Leaders setting the strategy, Talent Acquisition Leads scouring the market, and line managers making decisions on new hire offers and salary increases to retain existing team members, understanding Software Engineer salary trends is essential. 

Offer too little and you'll lose candidates to competitors. Overpay and you'll strain budgets and create internal pay equity issues.

So, to help, let's look at the latest data on average Software Engineer (and software developer) salaries from Ravio's 2027 Compensation Trends report – including how salaries differ by level, location, funding stage, and how AI Engineer pay compares.

What is the average Software Engineer salary in 2026?

The average salary for a Software Engineer in 2026 is £74,000 (source: Ravio Compensation Trends 2027).

This is the median salary as per Ravio’s salary benchmarking data, for a UK-based P3 Established Professional Software Engineer – a mid-level professional (or Individual Contributor), someone with in-depth knowledge of their discipline who works independently with minimal guidance and has a moderate impact on the success of their discipline.

The UK median rose 5.7% in 2026, after just 1.6% growth the year before – a clear pick-up after a year of near-flat pay.

Software Engineer salaries by level

Software Engineer pay more than doubles from Entry level (P1, £43,100) to Specialist (P5, £115,800), and reaches £145,900 at Expert level (P6) (source: Ravio Compensation Trends 2027, UK medians).

Job titles vary between companies, so the level is a better guide than the title. In Ravio's levelling framework, levels are defined by scope, impact, and autonomy rather than years of experience.

How do average Software Engineer salaries differ per country?

Mid-level Software Engineer salaries range from £51,600 in Spain to £74,000 in the UK (source: Ravio Compensation Trends 2027).

All salaries in GBP, converted at the end of Q3 2026 exchange rate, with euro equivalents for 2026 at £1 = €1.17. Year-on-year changes are calculated on a constant-currency basis.

Mid-level pay grew in every market this year, from +0.7% in Sweden to +6.2% in Spain.

The UK (+5.7%) saw one of the biggest increases, extending its lead as the highest-paying market.

That convergence goes beyond these six markets, too. Alexandra Stoica, Head of People, has seen salary expectations in Central and Eastern Europe catch up for the most in-demand engineering skills.

"Ten years ago, Poland, Romania, and Bulgaria were still largely viewed as outsourcing destinations, where companies could access strong technical talent at a lower cost," she says.

"But in 2026, in highly skilled areas such as AI or developer tooling, salary expectations have caught up with more established markets like Germany."

What is the average Software Engineer salary in London?

Software Engineers in London earn around 4-7% more than the UK as a whole, depending on level. The median salary for a mid-level (P3) Software Engineer in London is £77,000 (source: Ravio benchmarks, October 2026).

What is the average Software Engineer salary in the US?

US Software Engineer salaries are significantly higher than in Europe.

The median salary for a mid-level (P3) Software Engineer in the US is $154,000 (source: Ravio benchmarks, October 2026).

These are national medians. Salaries vary significantly between US cities, so for hiring in a specific location, use tiered location benchmarks – available in Ravio.

Software Engineer salaries by specialism

Pay also varies by engineering specialism. In the UK, DevOps Engineers and Data Engineers both earn slightly less than generalist Software Engineers (source: Ravio benchmarks, October 2026).

What is the average Engineering Manager salary?

The average salary for a Senior Engineering Manager (M3) in the UK is £126,900 in 2026, up 15.2% from £110,200 in 2025 (source: Ravio Compensation Trends 2027).

This is the median salary for a UK-based M3 Senior Manager in Software Engineering – a role providing leadership to other managers, accountable for the results of a team.

Overall, senior management pay is moving far less evenly than mid-level pay.

UK Senior Engineering Managers saw by far the strongest increase (+15.2%), while the Netherlands (-2.4%) and France (-4.9%) both saw declines.

Engineering leadership salaries: VP Engineering and CTO

At executive level, the median base salary for a VP of Engineering across Europe is £176,000, and £174,600 for a CTO (source: Ravio and Erevena executive compensation data, 2026).

The two are close on base salary, but C-level packages are larger overall: the median annualised equity grant is £37,300 for a VP of Engineering and £80,000 for a CTO.

Engineering has the lowest bonus opportunity of any executive function (median 15% of base for VPs, 17% for CTOs).

How do startup Software Engineer salaries differ per funding stage?

Software Engineer salaries increase as startups progress through funding stages.

Late-stage companies (Series C+, IPO) pay around 7% more than early-stage companies (pre-seed, seed) for mid-level Software Engineers, and 21% more for Senior Engineering Managers (source: Ravio Compensation Trends 2027).

The biggest movement this year was at early-stage companies, where mid-level Software Engineer salaries rose 12.6% and Senior Engineering Manager pay 14.7% – the fastest growth of any stage, narrowing the gap with later-stage companies. Daniel Illes, Portfolio Talent Director at Atomico, has seen the same thing.

"There used to be a real ceiling on cash comp by stage, but I'm now seeing seed-stage salaries that compete with Series B," he says.

"It's partly a hot VC market, and partly a conviction you can build a company with far fewer people who are compensated accordingly."

Software Engineer salary vs AI Engineer salary in 2026

27% of our survey respondents said they're paying a premium to hire AI/ML engineering talent currently.

And the data backs that up: there's a clear premium for AI Engineering compared with Software Engineering at individual contributor level in our benchmarking dataset.

AI Engineers earn 5-16% more than Software Engineers at every IC level. The gap is widest at the most senior IC levels (P5-P6, +14-16%) and, interestingly, at entry level (P1, +16%).

In management, the premium all but disappears – AI Engineering pay sits within 1% of Software Engineering at M2-M4, and slightly below it at M5 (-4.8%) (source: Ravio Compensation Trends 2027).

That fits the rise of the super IC: companies are paying more for exceptional individual builders, not for the people who manage them.

The one management level that still carries a premium is M1 (+6.8%) – likely founding-engineer-style roles that lead small teams while still building themselves.

Michelle Cheng, who leads European Talent at Bessemer Venture Partners, sees the same continued rise of the ‘super IC’. "We're still seeing a lot of emphasis on the 'super IC' role. I'd bet that if you looked at the number of direct reports those M1s have, it's probably lower than it used to be,” she says.

“A lot of companies are hiring at M1 level but not giving them huge teams too – that's where you get a lot of these founding engineer roles, founding go-to-market roles."

Where AI does make a clear difference is the type of company. Engineers at companies where AI is core to the product earn 10.2% more than at non-AI companies, for the same role, level, and country – and For the full picture, see our guide to AI compensation and talent trends.

What's happening in the Software Engineering talent market?

Beyond salaries, the wider data shows a settled market for most engineers, with competition concentrated on specific skills (source: Ravio Compensation Trends 2027):

• Hiring is slow. Engineering has one of the lowest hiring rates of any function (16.3%), though Software Engineer is still the most-hired single role, at 12.2% of all hires.
• Engineers are staying put. In alignment with the slower hiring, Engineering also has the lowest attrition of any function (7.5%) and the longest average tenure (1,084 days – about 3 years).
• Pay rises are in line with the market. The typical in-role pay rise for Engineering was 4.4% in 2026, and 25.6% of engineers got one.
• Many companies pay engineers above the median. 35% of companies target a higher market percentile for engineering and technical roles than for the rest of the workforce – suggesting that demand for engineering talent is still there on the hiring side, and perhaps its the engineers choosing to stay put in their current roles. Paula Aragon, Senior Total Rewards Specialist at Storyblok, has seen exactly that: "This year we’ve found Engineering candidates' expectations were running well ahead of our benchmarks," she says. "So we moved our salary ranges to match expectations and better incentivise the move, and it stopped being a problem – plus, once people have a role that's aligned with market expectations and stays that way, they're far more likely to stay for the long-term."
• The battleground is increasingly equity rather than just salary. "For engineers equity has become the real bargaining chip in the process. It's become the go-to leverage point in negotiations," says Michelle Cheng, European Talent at Bessemer Venture Partners.
• AI is reshaping the role. Petra Skoglund, Strategic HR Advisor, expects AI to keep reshaping demand for the role. "A lot of companies aren't growing their software development teams anymore. They're keeping the team they have and increasing efficiency through AI instead," she says.

Putting it into practice: setting competitive Software Engineer pay

• Decide where you want to position against the market – deliberately. Most companies target the market median, but over a third target higher for engineering roles. Be clear which engineering roles are genuinely business-critical before paying above median across the board.
• Benchmark by specialism and level, not just "Software Engineer". Backend, frontend, data, and AI/ML engineering can be priced differently, and job titles vary between companies – map roles to levels first.
• Handle hot skills without breaking your bands. Rather than baking a temporary market premium into base salary, use a defined mechanism – like a reviewable market premium or higher band placement – for in-demand skills. More in our guide to competing for in-demand jobs.
• Look at total compensation. With equity increasingly the lever in engineering negotiations, make sure candidates and existing engineers understand the full value of the package. Join our webinar on building a competitive package for top engineering talent.

FAQs

What is the average salary of a software engineer?

The average salary of a Software Engineer is £74,000. This is the median salary for a P3 Established Professional Software Engineer in the UK as per Ravio’s 2027 Compensation Trends report – Software Engineer salaries vary significantly by location and level. For example, Germany averages £67,300 whilst Spain averages £51,600 for the same P3 level. Senior Software Engineers (P4) earn £93,100 in the UK, and Senior Engineering Managers (M3) £126,900.

What is the average salary of a software engineer in the UK?

The average salary of a Software Engineer in the UK is £74,000 for a P3 Established Professional level (Ravio 2027 Compensation Trends report). That ranges from £43,100 at entry level (P1) to £145,900 at Expert level (P6). The UK median rose 5.7% in 2026, after rising 1.6% in 2025.

What is the average senior software engineer salary?

In the UK, the median salary for a senior individual contributor Software Engineer (P4, Advanced) is £93,100 in 2026, rising to £115,800 at P5 (Specialist, often titled Staff or Lead Engineer). For senior engineering managers (M3), the UK median is £126,900 (Ravio Compensation Trends 2027).

Is a software developer salary the same as a software engineer salary?

In most tech companies, "software developer" and "software engineer" describe the same role and are benchmarked together. In Ravio's data, the median salary for a mid-level (P3) Software Engineer in the UK is £74,000 in 2026. What matters more for pay is the level and the specialism (for example, backend, frontend, data, or AI/ML).

What is the average salary of a software engineer in the US?

The average salary of a Software Engineer in the US is $154,000 for a P3 Established Professional level (Ravio benchmarks, October 2026). For Senior Software Engineers (P4 level), the US median salary is $181,800, and for Senior Engineering Managers (M3) it's $221,500. Salaries vary significantly between US cities, so use location-specific benchmarks when hiring in a particular market. US Software Engineer salaries are significantly higher than European markets, with the UK equivalent being £74,000 for P3 and £126,900 for M3. Ravio's platform includes real-time salary benchmarks for different US locations, job levels, and Software Engineering specialisms.

What is typical total compensation for a software engineer?

Typical total compensation for a Software Engineer includes base salary plus equity compensation. In the tech sector, it's common for Software Engineers to receive equity as part of their compensation package – with the median new hire equity grant at 8.6% of base salary at the 50th percentile (Ravio equity benchmarking data). Variable pay is less common for Software Engineers – the median variable pay for Software Engineering is 9.0% of base salary, typically from on-call payments or company-wide programmes like performance bonuses or profit-sharing schemes.

What are the top hiring trends in software engineering?

The top hiring trends in Software Engineering in 2026 (from Ravio’s 2027 Compensation Trends report) include:

1. AI talent is the hot pocket – 27% of companies pay a premium to hire AI/ML engineering talent, 4x more than any other skillset.
2. Rising salaries – the UK P3 Software Engineer median rose 5.7% to £74,000 in 2026, and Senior Engineering Manager pay jumped 15.2%.
3. Slower hiring – the Engineering hiring rate fell to 16.3%, one of the lowest of any function.
4. Fewer junior hires – Engineering is the function companies say is most affected by AI adoption (78%).
5. Strong retention – Engineering has the lowest attrition rate (7.5%) and the longest tenure of any function.

Where can I get reliable salary benchmarking data for software engineers?

Reliable Software Engineer salary benchmarking data comes from real-time compensation platforms like Ravio, which draws from direct HRIS integrations. Unlike annual salary surveys that provide 6-18 month old data, Ravio's benchmarks are continuously updated to reflect current market conditions. Ravio provides global Software Engineer salary data, across all job levels and multiple specialisms (Backend, Frontend, Full Stack, AI/ML, etc).

How do companies benchmark software engineer salaries with reliable data?

The most reliable approach is to use a benchmarking platform that sources data via live HRIS integrations from a relevant peer group – tech and high-growth companies of a similar size, stage, and geography and with the tech roles you need. Filters for engineering levels (individual contributor through to staff and principal), location, and company stage are essential for getting a benchmark that reflects your actual market. Ravio covers software engineering roles across 50+ countries with real-time data from 1,800+ tech and tech-enabled companies, and benchmarks by level and location

Software engineer roles are one of the hardest to benchmark accurately using traditional salary survey data – the market moves quickly (like AI Engineering talent today), role definitions vary significantly between companies, and most legacy survey datasets are weighted toward large enterprises rather than the tech companies competing for the same talent.