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Slight Increase In Tech Worker Salaries: Survey

January 20, 2011

More U.S. technology professionals received salary hikes and bonuses last year than in 2009, according to an annual salary survey by online technology recruiter Dice.

However, since pay raises for tech workers outside large corporations and Silicon Valley were negligible, the average salary increase across all technology professionals was just 0.7 percent from 2009 to 2010.

The average tech worker salary was $79,384 in 2010, up from $78,845 in 2009.  This was roughly the same size increase that took place from 2008 to 2009.

About half of IT workers received pay raises in 2010, up from one-third in 2009, the survey found.

Average salaries were much higher in California’s Silicon Valley and in the Washington, D.C.-Baltimore area, where they averaged $99,028 and $89,149 per year respectively, Dice said.

However, IT salaries declined in Los Angeles and Chicago. Salaries for tech workers in Atlanta and Philadelphia were lower, but rose at a faster than average rates from 2009 to 2010.

The survey included responses from about 20,000 tech professionals between late August and mid-November of 2010.

IT professionals expressed slightly higher satisfaction with their salaries in 2010 compared with 2009, with 50 percent saying they were “somewhat” or “very” satisfied.   Last year, 46 percent reported being “somewhat” or “very” satisfied with their pay.

About 40 percent of the respondents believed they could make more money if they switched employers this year, while 24% felt switching employers would not increase their pay.

“Companies can no longer get away with paltry salary increases for their technology staffs based on the demand we are seeing for talent,” said Tom Silver, Dice’s Senior Vice President for North America.

“The moderate increases in satisfaction levels indicate that tech professionals’ concerns are being heard by some companies, but certainly not all. Retention is the key to driving additional contributions to the business from technology staffs. Employers that are reluctant to increase compensation or step-up retention efforts will likely pay for their unsatisfactory ways.”

The U.S. unemployment rate for tech workers is 8.1 percent, more than one percentage point below the overall U.S. jobless rate of 9.4 percent.  

Tech professionals have typically been able to find new jobs in less time than those outside the industry, according to government data.

As the job market for skilled tech workers slowly improves, more IT professionals will have the option of working for a different company, something that could pressure employers to retain staff through bonuses. 

Last year, 29 percent of tech firms did so, compared with 24 percent in 2009.

“The revival of employment demand for technology professionals started about this time last year in Silicon Valley,” said Alice Hill, managing director of Dice.com.

“Very quickly, companies are facing higher compensation costs, retention troubles, and shortages in certain skill-sets,” she said.

Despite some of the promising signs revealed in the survey, there was some bad news as well.   For instance, wages for workers entering the tech sector fell for the second consecutive year, with average salaries of IT professionals with less than two years experience six percent below their peak average wages in 2008.

According to the survey, working for a large company (with 5,000 or more employees) and adding new skills and expertise were two distinct ways for tech workers to earn higher salaries.

Indeed, technology professionals employed with large companies earned an average salary of 88,075, while those working in similar positions for the smallest companies earned, on average, $69,658.

As for skills, workers with annual wages of $100,000 or more had experience in areas such as developing programs for SAP AG’s software system ($105,887), running Informatica databases ($101,898), Extract Transform and Load ($100,983) and Service Oriented Architecture ($101,827), Dice said.

By analyzing the frequency of requested skills appearing in job postings on Dice.com, a central set of critical skills emerged for technology professionals.

Oracle experience is currently requested in more than 15,000 job postings on any given day, and comprises nearly a quarter of all job postings on Dice.  Demand for that top requested skill is up 57 percent year over year.

The national average salary for IT workers with experience in Oracle Database is $90,914, and $88,063 for those with experience in Oracle Application Server, Dice said.

Following Oracle, J2EE/Java (14,663 job postings, up 50% from last year) and C, C++, C# (14,123 job postings, up 46% from last year) are the most frequently requested skills.  Workers proficient in J2EE/Java earned on average $91,060, while programmers specializing in the C languages earned between $85,500 and $90,350 on average.

Those with strong project management skills are also in high demand.  According to the survey, the average salary for Project Managers is $100,143, with companies requesting project management experience in a wide variety of job postings.

Rounding out the top five most valuable skills is SQL (11,875 postings, up 47% year over year), with an average salary of $84,375.

After a slip in average salaries last year, salaries for Silicon Valley tech workers rose three percent last year to an average salary of $99,028.  Additionally, 35 percent of Silicon Valley respondents received a bonus in 2010, compared with just 26 percent in 2009.

“This experience provides a roadmap for employers outside of Silicon Valley, because demand is strengthening across the country for tech talent,” said Hill.

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