Tech's six-figure salaries are shrinking

IT managers at midsize firms take the biggest hit

by Patrick Thibodeau

Computerworld - The salaries of IT managers are retreating, and those who are most affected by the trend are managers running technology operations at midsize companies with less than $500 million in annual revenue, according to a semi-annual study from Janco Associates Inc.

From January 2007 to this month, the median compensation, including bonuses, for a CIO at a midlevel company with less than $500 million in annual revenue fell from $171,755 to $162,937, a decline of 5.13%. In the same period, chief security officer salaries moved from $148,117 to $143,284, a 3.26% decline. IT planning directors took the biggest hit, falling from $115,434 to $97,588, or 15.46%.

Janco's semi-annual survey tracks salary and benefits changes at more than 200 companies.

Salary declines for IT executives at larger companies weren't as steep as the cuts at midsize firms. Over the same two-and-half-year period, compensation for those managers fell between 1% and 6%. For instance, the median CIO salary went from $174,979 to $172,505, a decline of nearly 1.5%.

Most of the compensation decline has been in the last 18 months, Janco reported. In that period, a number of companies have announced staff salary reductions, including Hewlett-Packard Co.

"There is now a surplus of seasoned IT professionals available," wrote the Park City, Utah-based IT consulting firm in its report. In particular, it reported that more than 200 IT professionals in the New York area, who earned well over six figures, are looking for work because of mergers, bankruptcies and layoffs. Some IT managers are also putting off retirement, and others who previously retired are now searching for work again.

Overall, IT employment has declined 3.5% since May 2008, according to the TechServe Alliance, formerly the National Association of Computer Consultant Businesses. In November 2008, IT employment peaked at 4 million jobs, but that figure had dropped to 3.85 million as of last month

Summary Results and Changes in Demand for IT Jobs 2009

Janco has captured IT compensation statistics since 1996 and publishes the resultant IT Salary Survey semiannually. The IT Salary survey is based on Janco Associates, Inc. IT Professionals compensation database, and compensation benchmark ranges are established for each normalized job position. In analyzing the study data, the upper and lower quartiles are eliminated to determine Benchmark Ranges. The benchmark ranges are then used to assess the alignment of a company's actual compensation to the marketplace for each job function. A summary of the most recent salary survey can be downloaded by visiting IT Salary Survey.
Janco is Mountain States based consulting firm that publishes the IT Salary Survey, Browser Market Data, and the HandiGuide® series of book used by IT, HR and other professionals as the source of information on topics from polices and procedures, to job descriptions and responsibilities.