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4/27/2007
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Chris Murphy
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The Average Tech Manager Makes $105,000, Our Salary Survey Finds. Have Tech Jobs Bounced Back?

There's a lot of good in our survey of 7,200 IT pros. But dark clouds swirl around entry-level wages, job growth, and outsourcing.

The typical U.S. business technology manager now makes $105,000 in salary and cash bonuses, the first time this professional has joined the six-figure club in the 10 years InformationWeek has done a salary survey. Median compensation for IT staffers is $78,000, with five job categories surpassing $90,000, our survey of more than 7,200 tech pros finds. Median base salaries--not just bonuses--are edging up for the first time in several years.

But there are worrisome signs. Foremost among them is a dip in median pay for those age 25 and under--precisely the people the industry is working so hard to attract and keep. And the mostly upbeat salary numbers come against a backdrop of slow U.S. IT job growth in recent years. The country employs 3.49 million IT pros of all types, according to the Bureau of Labor Statistics--just 1% more people than in the heyday of 2001 and 5% more than in recession-racked 2004. So even as our salary survey paints an optimistic picture, the question is whether IT jobs will be a growth opportunity for more people or a well-paying niche for fewer, as jobs are automated or moved offshore.

Life's not easy for IT pros, so don't drop your guard. Our advice from last year's survey--that U.S. business technology pros build their careers with offshore competition as their No. 1 rival--still holds. We've created a package of how-to career advice, recognizing that at every stage tech pros must manage their careers, probably more so than most other professions given the fast-moving nature of the technology they work with and the surge of offshore competition they face.

Yet there's also a vibe in these numbers, and in the industry, that the "lucky to have a job" sentiment of a few years back has faded. People dare to ask for raises, to push for more exciting work, to consider more than job stability. Others will see dark clouds in these numbers, and they're right to be wary--we'll be discussing such issues all week at information week.com/blog, and we'd love to have you join us.

THE RETURN OF RAISES
The big picture is this: After three years of nearly stagnant pay, base salaries are up. Bonuses also improved, particularly for managers.

Previously, base salaries were in lockdown mode. In 2004, 2005, and 2006, the median base for staff and managers moved about 1% a year--a net decrease considering inflation. This year, the median base pay is up 6.6% for managers and 5.7% for staffers, well above inflation.

When asked how big a raise they received, managers report a 4.2% base salary increase over the previous year, and a 5% increase in total compensation, on average. Two years ago, they reported raises a full percentage point lower: 3.2% raise in base, and 3.4% in total compensation. Staffers report a 3.6% total compensation increase this year; in 2005, they got an average 2.5% raise.

Bonuses continue to be an important part of total compensation. As a percentage of median income, bonuses are holding steady at 8% of pay for managers. In the boom days early in the decade, a whopping 18% of managers' pay came from bonuses. For staffers, bonuses are 5% of pay.

Survey respondents are feeling more confident about their jobs, and thus have higher expectations. Job stability and security are less a concern, doing innovative work is a bigger priority, and cold cash is a bigger deal than soft benefits.

More than half of managers--52%--feel "strongly secure" about their jobs, up from 40% in the layoff-prone days of 2004. Just 9% feel insecure, down from 14%. As for staffers, 42% say they're strongly secure, up from 31% in 2004, while 13% feel insecure, down from 19%.

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Last year, 58% of staffers cited job stability as one of the factors that matter most, more than any other factor. This year, just 33% cite it. Chew on that a moment: A full two-thirds of IT staffers don't include job stability at all among their most important factors. For managers, the shift is just as dramatic: from 49% last year to 25% this year.

The wow factor is way up, too. This year, 28% of staff cite working with leading-edge tech as a "most important" factor in a job, up from 12% last year; 34% cite creating innovative IT solutions, up from 9% last year. More managers have caught the creative bug--40% cite creating innovative IT as a most important factor, up from 13% last year. It was almost an oddity a year ago for people to put a priority on leading-edge work.

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