What is the salary of a software engineer?

Every day, companies start their day with the ritualistic statement:

“We need a software engineer... or five.”

Businesses in almost every sector are undergoing digital transformation, which requires skilled software engineers to develop, maintain, and optimize digital solutions. Moreover, as industries seek to automate processes, artificial intelligence and machine learning applications are becoming more prevalent. Engineers with expertise in these areas are highly sought after to create intelligent systems. Then, the rise of tech startups has fuelled the demand for engineers to develop innovative products and services.

From cloud computing to AI, companies are leveraging technology to stay competitive, and who better to make that happen than a software engineer who drinks more coffee than water and speaks fluently in a programming language or two?

Factors influencing the salary of a software engineer#

There are various factors that influence the salary of a software engineer, such as:

• Location

• Industry

• Company 

• Experience level

Location#

Geographical location is an important factor in determining the salaries of software engineers. In tech hubs like Silicon Valley or New York, software engineers often command higher salaries due to the high demand for tech talent and the cost of living. 

In contrast, countries like India or Eastern European nations may offer lower salaries compared to the US, but the cost of living is also lower, making the compensation competitive in the local context.

Industry#

The industry is a crucial factor that determines the salary of software engineers. While tech giants like Google, Amazon, and Facebook offer high-paying positions, the salaries in non-tech industries can vary significantly. For instance, software engineers working in finance, healthcare, or biotech often earn more than those in education, government, or non-profit sectors. In contrast, industries with less emphasis on digital innovation may not be as competitive in terms of salary but may offer other benefits like work-life balance or job security. 

Company #

Product-based companies like Google, Microsoft, or Adobe generate revenue directly from the software and solutions they create, allowing them to offer higher salaries to attract and retain top engineering talent. On the other hand, service-based companies typically offer services to clients, such as software development, IT consulting, or maintenance. As a result, their pay structures may not be as generous, though they often provide job stability, opportunities for learning different technologies, and varied project exposure. 

Experience level#

Software engineer salaries are also based on years of experience. As software engineers progress in their careers, their knowledge deepens, and their ability to handle complex projects improves, making them more valuable to employers. In addition to that, engineers who have developed niche skills, managed teams, or led significant projects may find that their experience amplifies their salary potential even further.

The salary of a software engineer#

The salary range of a software engineer is spread across three levels:

1. Entry-level

2. Mid-level 

3. Senior-level

Entry-level#

Entry-level engineers typically have 0–2 years of experience. At this stage, they are primarily focused on building their foundational technical skills, such as coding, debugging, and understanding software architecture. While they may have theoretical knowledge from academic training, they generally lack hands-on experience, and thus, the salaries for this level are quite low compared to other levels. Entry-level engineers can earn $80–$110k annually. 

Mid-level #

Mid-level engineers, typically with 3–5 years of experience, often experience a substantial salary increase due to their ability to handle more complex tasks, work with greater autonomy, and contribute meaningfully to critical projects. Their increased value to the organization is reflected in their compensation as well as in their influence on company projects and junior team members. Hence, the yearly salary for mid-level software engineers is around $120k–$150k.

Senior-level#

Senior engineers have 6+ years of experience. By this stage, senior engineers have mastered the technical aspects of their domain and have also developed a comprehensive understanding of the broader tech industry and its trends. Their experience allows them to make high-impact decisions that can directly influence the success of projects and the overall direction of the company. For this reason, senior engineers have the highest salaries, ranging from $140k–$200k.

High-paying software engineering roles#

While software engineering is undeniably a lucrative field, there are also certain specialized roles within the industry, such as:

• Full-stack engineers 

  • Salaries range from $80k–$180k

• Software architects

  • Salaries range from $120k–$210k 

• DevOps engineers

  • Salaries range from $90k–$190k

• Machine learning engineers

  • Salaries range from $90–$220k

• Cybersecurity engineers

  • Salaries range from $120–$210k

Salary negotiation tips for software engineers#

Here are the top four negotiation tips for software engineers to secure the right deal:

Research market rates: Before entering negotiations, use resources like Glassdoor to research the average salary for your role, location, and experience level. 

Highlight specialized skills: Like other professionals, software engineers are paid for their services. Emphasizing any in-demand skills or certifications can guarantee a better offer. Employers are often willing to pay a premium for specialized expertise. 

Consider total compensation: Tech companies often provide equity, signing bonuses, and other perks that significantly add to your total compensation package. Hence, software engineers should negotiate beyond just the base salary. 

Be willing to walk away: Software engineers should know their worth and never settle on an offer that doesn’t meet their expectations.

Final word#

Since entry-level software engineers are only responsible for tasks such as bug fixes, implementing basic features, or assisting in the development of larger projects, the salary ranges are also on the lower end. On the other hand, the role of senior engineers extends beyond simply writing code and includes system performance, security, and scalability. Along with setting technical direction and standards for the entire engineering team, they command higher salaries. The combination of technical competence, the ability to work independently and within a team, and contributions to larger projects determine the variations in salary ranges for software engineers.