IT Salaries to Climb in 2012, But How Much?

By Ericka Chickowski  |  Print this article Print

Will you see more money in your paycheck in 2012? Two new forecasts from analyst firms say yes. But just how much more can you expect? Here's the scoop.

Two reports out this month show that IT workers will get a slight pay raise in 2012, though conclusions diverge. While one report from Computer Economics notes the bump in pay, it warns that salary increases will not keep pace with inflation this year. But other findings out from Dice show that IT workers could see their pay shoot up in other ways, namely through bigger bonuses.

According to the Computer Economics IT Salary Report 2012, the average IT worker will garner a 2.8 percent raise in 2012. At best, organizations within the 75th percentile of technology salaries reported only a 3 percent increase for their workers expected over the next year. Those in the 25th percentile reported a skimpy 1.8 percent raise.

Meanwhile, Dice reported in its recent salary survey that last year its respondents experienced just over a 2 percent increase in pay. Though this may seem scant, Dice executives report that this is the biggest increase since 2008. The average annual wage was $81,327 compared to $79,384 in 2010. Dice reported that the tech sector in Silicon Valley is leading the pack, with the region’s technology salaries breaking the six-figure barrier for the first time since Dice started its salary studies a decade ago.

"Compensation has mustered some momentum, as more and more top tech markets are notching increases in pay. Silicon Valley’s compensation moved first and wrote the playbook for highly qualified tech professionals to ask for more," said Tom Silver, senior vice president of  North America at Dice.

However, not everyone will be jumping for joy at their career prospects this year. Computer Economics points to the 3.4 percent rise in the Consumer Price Index as evidence that IT workers’ spending power has gone down ever so slightly and expectations for hiring this year will remain muted.

"Although there are modest improvements in the general employment picture, our research indicates hiring by IT organizations across all sectors will remain weak in 2012, especially among large organizations," the report said.

In spite of this, Computer Economics did state that turnover rates are climbing in IT, particularly among experienced workers.

"The voluntary turnover rate for IT organizations, after dropping to nearly 2 percent in 2010, is on track to return to normal levels in 2012," the report said. "Turnover rose to 4 percent in 2011, and we anticipate it returning to the 5 percent level, which was typical during the period prior to the 2008 recession."

This trend may be driving what Dice sees as an interesting phenomenon, as the size of bonuses and number of professionals receiving them outstrips normal salary increases. Dice reported that

A recent report out from Computer Economics shows that while IT workers will get a slight pay raise in 2012, technology salary increases are not going to keep up with inflation this year.

"The increasing popularity of bonuses shows companies are rewarding their top performers," says Silver. "While everyone loves a bonus, anyone who has been through a cycle knows that bonuses both reward and punish. In fast-changing markets, it’s imperative for highly skilled tech professionals to capitalize on their career and compensation options."