IT wage growth has suddenly stopped, replaced by a downturn
IT workers in the US are facing a decline in average wages. It has fallen by 1.1% over the year. There are several reasons for this phenomenon and among them – the desire of employers to hire less experienced and, therefore, less demanding to the salary, specialists.
There is less money
In 2021, the average salary in the field of high technology tends to decrease, writes ZDnet. There are several reasons for this and one of them is the “staff shortage”, forcing employers to hire junior staff in order to cover the shortage of specialists.
The conclusion about the decline in the average salary of IT industry workers were made by analysts of the recruitment platform Hired. Their data refers only to the U.S., but this could potentially happen in other countries around the world.
Experts have analyzed more than 525 thousand job interview requests and 10 thousand job offers for the period from January 2019 to June 2021. It was found that the average salary in the IT sphere in the U.S. in 2021 was within $152 thousand, which is 1.1% less compared to 2020, the year of the pandemic coronavirus.
High number of IT professionals leads to lower salaries
The global epidemiological situation has also partly contributed to the drop in salaries. Widespread lockdowns have led to numerous layoffs in the US, even in IT. The consequences of the wave of layoffs are obvious – competition between high-tech professionals, including software developers, has increased.
On the other hand, the demand for IT workers has also increased since the pandemic. Hired also claimed that employers started hiring less experienced and therefore more affordable IT workers in terms of the salaries they demanded. Recruiters have also had to reduce average recruitment times to 30 days in the US and 34 days in the UK. This is an average of 25% less than in 2020.
“Remote workers” are swimming in money.
For now, the decline in average salaries can be observed only among IT professionals who, for one reason or another, work in the office. Those who have made the choice to work from anywhere in the world, however, recorded an increase in wages.
According to Hired, in the first nine months of 2021, the average salary of remote IT workers in the US increased by 4.6% year-on-year. It stood at $143,000.
On the one hand, this is not a small increase in such a short period of time. On the other hand, remote workers on average are paid less than their office colleagues.
It should be noted that the mass move to remote work has also played a role in the “impoverishment” of office workers. More and more employees have begun to move from major technology centres to areas with a lower cost of living. In such cases, employers don’t pass up the opportunity to cut wages on the grounds of lower costs for the employee. In addition, employers are increasingly promoting their firm on recruitment platforms by opening positions remotely. This allows them to pay employees less from the start than if they worked in an office.
Salary manipulation is not welcome
The fact that companies reduce the salary of IT employees who have moved to a remote location was confirmed by analysts of Hired. However, they strongly advise employers against this practice, because otherwise they run the risk of large-scale staff turnover in their IT department.
Interviewing more than 1,200 people, experts Hired found that 75% of IT professionals will definitely start looking for a new job as soon as the employer reduces their salary because of the move to a remote location. 45% of respondents added that they would not listen to the arguments of employers that the salary is calculated based on the current location of the employee.
Sixty-two per cent said they are planning to start looking for a new job right now and find one in the next six months. This means that any pay cuts will only increase this number.
Remote working appealed to all
Remote working has caught on with IT professionals, at least in the US, according to a Hired survey. 52% of respondents said they want to work from home and come into the office when they, not their employer, wants them to. Another 33% said they did not want to be in the office at all and would prefer to work remotely at all times.
As a result, 85% of IT workers want remote working to some extent in their working schedule. They want the option to work from home to be part of their employment contract.
As reported by CNews, the categories of “zoomers” and “millennials” are the most likely to want to quit their jobs due to the lack of telecommuting. These are people born between 1980 and 2012. In both categories, 49% of people don’t want to return to the office.