InformationWeek’s Annual Salary Survey is out and as always provides an interesting look at IT salaries and great insight into what IT workers are thinking about. If you work in the IT industry or employ IT workers, you’ll want to read it. For InformationWeek’s summary of all the results, click here. If nothing else, we all like to compare what we make with what others do!
Not surprisingly, one of the things this year’s survey shows is that salary really matters!
48% of IT staff and 43% of IT managers cited base pay as one of the factors that matters most. Allowed to choose seven out of a larger list, it was the number one response for staff and number two for managers (behind “my opinion and knowledge are valued”). Chris Murphy, the author of the study says that, “Companies must make sure they take care of these baseline factors [which also include benefits and flexible schedule], or they aren't even in the game of competing for talent.” The importance of salary is underscored by the fact that 72% of IT staff and 70% of managers cite higher compensation as the number one reason to look for a new job, far outweighing the number two reason, “more interesting work,” at 49% and 43% respectively.
Our experience has shown the same thing. The study shows that there are many factors that matter to IT professionals and not everyone cares the same about the same things but the numbers don’t lie. A company that hopes to attract and retain good, let alone the top, IT professionals simply must be offering competitive pay and benefits. This may seem obvious but the recent recession and the current high unemployment numbers amid the “jobless recovery” continue to give some the impression that talent is plentiful and should be relatively cheap. In the IT industry, this just isn’t true and operating under this assumption will cause problems.
If you’re wondering why your key employees are leaving, why you can’t find the talent you need, or why you keep losing out on promising candidates, start by looking at what you’re paying your IT staff. Benchmark it against the current market carefully and adjust accordingly. If you’re not paying market rates you can’t expect to attract the best. If you’re an IT company, you may already know this and behave accordingly, but if you’re trying to hire for an IT department at a company where their core competency workers are more plentiful and salaries are somewhat depressed, you may struggle to convince senior management about the rates the company will need to pay to attract the right people. InformationWeek’s survey might be useful in this endeavor.
For those who think that working at a prestigious company or on leading edge projects can make up for lower wages, think again; the numbers suggest otherwise since those came in at 6% and 21% for staff and 8% and 19% for managers. Again, there are certainly people to whom this matters and not everyone is the same, but overall, not much makes up for salary discrepancies. This is good news for companies who think that unless they are Google or Apple, they’ll never win in the talent wars. Many factors are more important than working at a big name company and you can compete on those, especially salary.
We see this in action in our day to day business all the time and work with our clients to understand the market for the positions they are trying to fill, on a contingent or permanent basis. Understanding the market for the talent you need requires information. The InformationWeek survey is another source of information that can help those of us working in the IT industry. As business people, we understand the importance of managing costs but we also understand that companies need good employees to be in business at all. Work that goes undone costs a firm money as well. Make sure that you’re not being pennywise and pound foolish when it comes to what you are paying your IT staff and managers. Salary matters and it could be the difference between hiring the person you want or losing them to a rival.