The average salaries for the engineering positions across product development companies in India have come down by 3 per cent.

Bangalore continues to be the highest in its pay scale followed by Chennai, Pune and NCR, says Compensation and Benefit Study 2008 Report by Zinnov - a management consulting firm.

The reason for the dip is the increased hiring at the junior-level. "About 40 per cent of the average talent pool among the participating companies are with 0-4 years experience," said Shamim T, director human capital consulting, Zinnov.

While the dip in average salary could be an indication of stabilising, organisations are also trying to keep the salary levels under control. They are offering other cash-based incentives such as retention bonus.

The report said the expected average increment in 2008 is about 15 per cent, with a few organisations planning to give almost 30 per cent hike to its top performers and rare skill holders.

Pune witnessed salary increase of almost 15�20 per cent in the average salary since last year. This increase could be attributed to the growing demand for talent pool in the city due to a number of companies setting up its operations in Pune. The average increment in 2007 was around 14 per cent.