The hiring landscape for UK scale-ups is being reshaped by artificial intelligence at an “unprecedented speed”. According to the newly released 2026 Salary Benchmark report authored by Santa Monica Talent, London’s technology recruitment market is fracturing into a distinct two-tier system.
While AI-specific roles are securing salaries upwards of £250,000, the broader market is experiencing a decline in traditional leadership positions and salary freezes for roles lacking an AI component. The report notes that Tier-1 AI firms, such as OpenAI and Anthropic, are actively distorting the market upward, creating a widening talent gap.
The great developer divide
The most stark illustration of this market fragmentation is found in software development. The report highlights an “extreme market segmentation” for developers, where base salaries now range wildly from £100,000 to £250,000 depending on the specific sector.
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Developers at Tier-1 AI firms, late-stage fintechs, and private equity (PE)-backed transformation projects are seeing compensation at the upper end of this bracket.
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Those positioned at smaller startups or sector-specific platforms, such as legal or health tech, remain at the lower end of the scale.
“The market is fragmenting dramatically,” the report notes. “The same job title attracts vastly different compensation depending on sector, stage, and AI capability.”
The benchmark data suggests that technical skills alone are no longer sufficient to command top-tier pay. Instead, the highest market value is placed on talent capable of translating AI capabilities into provable return on investment (ROI). Consequently, “Forward Deployed Engineers” are emerging as a new power role within the ecosystem. These engineers bridge the gap between technical build and customer implementation, pulling in salaries reaching up to £200,000.
Leadership roles in flux
The C-Suite is also undergoing a significant evolution. According to the report, a traditional Chief Technology Officer (CTO) title now encompasses “completely different roles” depending on the maturity of the company.
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A Series A CTO—typically a hands-on “player-coach” often promoted from a VP of Engineering position—commands a base salary between £150,000 and £200,000.
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A late-stage or PE-backed CTO, who is focused on governance, security, and team scaling, can expect a base salary between £200,000 and £350,000, alongside the potential for “life-changing” equity payouts.
However, not all executive roles are seeing growth. The data points to a contraction in C-Suite and VP hiring as companies increasingly merge functions to maintain lean operations. Roles such as Chief Marketing Officer (CMO) and Chief People Officer are in decline, often being replaced by fractional hires or consolidated into broader remits like ‘Chief Revenue Officer’ or ‘Chief Operating Officer’.
The financial cost of remote work
Location remains a critical factor in compensation strategies. Despite the normalisation of hybrid work over recent years, the report finds that in-office roles continue to command higher salaries.
Conversely, fully remote roles or those offering a four-day work week commonly come with salaries approximately 20 per cent lower than their in-office counterparts. UK companies are also responding to rising taxes by hunting for lower-cost office locations, even as they face a “brain drain” of talent relocating to low-tax domiciles in Europe, the Middle East, and the US.
Ellis Seder, CEO of Santa Monica Talent, noted the complex challenge this presents for founders and operators. The shift from aggressive “blitzscaling” to lean, AI-enabled operations demands a vastly different set of leadership skills.
“Companies face a widening talent gap as AI roles command premium salaries while traditional leadership positions decline,” Seder writes in the report.
Ultimately, the report serves as a warning for digital scale-ups: reliance on job titles for benchmarking is increasingly futile. Successful hiring in 2026 will require a nuanced understanding of how AI adaptation, sector focus, and operational stage dictate value in a highly fragmented market.
