Despite slowing somewhat, IT salaries continued to rise during the first quarter, in some cases pushed notably higher by a lack of professionals with the expertise needed to help businesses meet federal health-care mandates and varying business requirements.
According to the PayScale Quarterly Index, the usual growth rate of IT pay of more than 1 percent per quarter stalled at just 0.2 percent during the first period of the year. In addition, overall wages in some tech-centric cities stalled or even slightly declined, though tech recruiters say they continue to see stiff competition and strong offers being made to technology candidates.
The PayScale Index tracks the salary required to fill positions, PayScale lead economist Katie Bardaro explained. While it reflects inflation and market changes, it doesn’t track raises given to existing workers, she said.
Tracking more than 300,000 employee profiles per quarter, the index is designed to factor in a worker’s level of experience, education, employment setting and job responsibilities to track pay from one point in time to another. Since the index’s base year of 2006, the tech sector has consistently been a leader in wage growth, Bardaro said, attributing any hiring hesitation to general economic uncertainty.
Pay for Premium Skills
Over the past 12 months, IT salaries grew 5.1 percent, compared with 3.5 percent for wages in the overall economy, PayScale’s figures show. (Dice’s most recent salary survey, which polled employed tech workers on their pay, also found salaries for full-time tech workers grew by 5.1 percent, to an average annual salary of $83,370.)
Bardaro calls the PayScale Index “a direct application of supply and demand,” and she notes that in the current labor market, uneven as it may be, tech workers remain a hot commodity. “There is high demand for their talent and limited supply (which) drives up the going wage rate,” she said.
For example, health-care organizations are still scrambling to meet federal mandates for technology associated with the Affordable Care Act. IT workers with the skills to help meet those deadlines can command premium pay. Experience with EPIC information systems, for instance, can boost pay by 10 to 20 percent, based on job and location.
Other skills with strong wage growth:
- Tableau software
- Android SDK and iPhone SDK
- Ruby and Ruby on Rails
- Search engine development
Bardaro said wage growth was highest for front-end developers, more so than back-end IT functions, and for any positions involving both IT and analytics.
DevOps is Hot
The index found slight overall wage declines in some tech hubs, including Boston (down 0.7 percent) and Seattle (down 0.2 percent), while growth softened in San Francisco to 0.7 percent compared to previous quarters of more than 1 percent. Bardaro pointed out that those drops weren’t specific to tech jobs, however.
Rob Byron, principal consultant and team leader of information technology at WinterWyman Search in Boston, said he’s seen no declines in IT offers. “Companies have to make competitive offers to fill positions,” he said. “We’re seeing candidates kicking offers, staying at their company.”
One area where Byron sees particular heat is DevOps. “It’s fairly new (so) to find someone like that, it’s pretty competitive. There’s only a small number of candidates who have that skill set.”
Byron also says many candidates are negotiating for better terms before accepting an offer. “We’re seeing in almost every deal we do these days, the candidates have a little more power. In certain skill sets, there’s so much demand and there are not enough qualified candidates out there. So they have a little bit more cachet,” he said.
David Knapp, regional VP for technology and creative services at Robert Half International in San Francisco, also identifies skills in particular demand:
- Application developers, with salaries up as much as 9 percent over the past year.
- Business intelligence analysts, with a rise of 7.3 percent.
- Network architects, up 7 percent.
It’s not only big companies who are paying up, Knapp says. Startups, too, know it’s a level playing field when it comes to recruiting. “They’ve got to be as competitive as possible,” he said. “They need to put their best foot forward in making an offer. Then they can throw in value-adds such as technical education, certification, working from home. You’ve just got to put the best offer out there.”