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Businesses Stats The Almighty Buck IT

IT Salaries Edge Up Back To 2008 Levels 266

Posted by timothy
from the is-that-your-experience? dept.
tsamsoniw writes "A soon-to-be released salary survey finds that the average salary for IT professionals in the U.S. is $78,299, putting overall compensation back at January 2008 levels. More heartening: Midsize and large companies are both aiming to hire more IT pros. The midsize are seeking IT executives (such as VPs of information services and technical services), as well as programmers, database specialists, systems analysts, and voice/wireless communication pros. Enterprises are moving IT and data center operations back in-house, which means greater demand for data center managers and supervisors."
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IT Salaries Edge Up Back To 2008 Levels

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  • Average (Score:5, Insightful)

    by Dyinobal (1427207) on Friday January 06, 2012 @10:22PM (#38618146)
    The average is going up because all the lower end IT positions are over seas mostly now, at least that is my guess. I always found these 'average' salaries to be very misleading. Because I always seem to be making below the average.
    • by Dyinobal (1427207)
      well over seas and being replaced by the nebulous 'cloud'
    • Re: (Score:3, Insightful)

      by Anonymous Coward

      I wish they'd report median salary more. It's probably much lower. Executive pay is ridiculous. Even IT executives.

    • Re:Average (Score:5, Insightful)

      by Darkness404 (1287218) on Friday January 06, 2012 @10:51PM (#38618362)
      It all depends on where you live and even then what you make in dollar terms means little when it comes to how well you can live. Making $78K in some big cities gives you a decent livable apartment and a decent, but not extravagant, lifestyle. Making $78K in some other areas of the country gives you a large house and a more extravagant lifestyle.
    • Re:Average (Score:5, Interesting)

      by t0qer (230538) on Friday January 06, 2012 @11:00PM (#38618426) Homepage Journal

      You call this going up?

      I made $85k in 2001, before 9/11 and before my layoff (after 10 years in IT) Ever hear the saying, "If you're out 6 months, you're back at square one?" It's true.

      The economy is fucked as ever. The kids they're paying $78k to have vastly more talent than I ever did, and had they been getting paid 2001 wages, would be making closer to 130k if not more.

      • Re:Average (Score:5, Informative)

        by Anonymous Coward on Saturday January 07, 2012 @12:42AM (#38619020)

        Stop bitching and follow the money. Some of us are making the 130k even though the economy is "fucked".

        Or you're still pimping your vertas+solaris skills and not following the buzzwords. There's at least another year on the cloud train, time to hop on it buddy.

        • Re:Average (Score:4, Insightful)

          by netsavior (627338) on Saturday January 07, 2012 @01:00AM (#38619136)
          No shit. We are almost done virtualizing our entire datacenter, I assume the next step is to realize that having a single point of failure for 20 virtual servers isn't as cool as having 20 dirt cheap real servers, each independant. So maybe we can squeeze a few more years bouncing back with de-virtualization. "From the cloud to localization, the next revolution! Have a little piece of the cloud right in your own office!"
          • Re:Average (Score:5, Informative)

            by Grishnakh (216268) on Saturday January 07, 2012 @01:28AM (#38619324)

            No shit. We are almost done virtualizing our entire datacenter, I assume the next step is to realize that having a single point of failure for 20 virtual servers isn't as cool as having 20 dirt cheap real servers, each independant.

            What are you virtualizing them onto? If it's a big machine that's highly redundant, then the "single point of failure" mantra is false. On a big iron machine where you can hot-swap power supplies, hard drives, memory, CPUs without missing a beat, there is no single point of failure, and you get much higher availability than 20 dirt-cheap servers where something could break at any time.

          • Re:Average (Score:4, Insightful)

            by LordLimecat (1103839) on Saturday January 07, 2012 @02:33AM (#38619598)

            Step 1:
            Consolidate onto virtualized servers.

            Step 2: create multiple VM hosts with high-availability

            Step 3: set up redundant networking (switches, etc)

            Im not seeing the problem, nor the single point of failure. In fact, virtualization is much cooler than those crappy servers, since you can take a server offline without taking the service offline by migrating a guest between hosts. That is, in fact, one of the main reasons you use virtualization to begin with-- to disassociate the service from the piece of hardware.

      • Re:Average (Score:5, Insightful)

        by evilviper (135110) on Saturday January 07, 2012 @12:50AM (#38619080) Journal

        I made $85k in 2001, before 9/11 and before my layoff (after 10 years in IT) Ever hear the saying, "If you're out 6 months, you're back at square one?" It's true.

        You seem to be completely missing the context here.

        First, 2001 was still during the hey-day of the dot.com bubble. You're upset that you aren't earning as much as you think you should be, but here I missed out on the bubble entirely, as really Jr. level people I worked with were getting $150,000 job offers as soon as they got some certification or other...

        I know it sounds harsh, but you need to consider the possibility that you weren't ever worth $85k, and you were lucky enough to have been getting an insanely inflated salary for a few years. It's "found money" to you.

        And the 6-month rule? Did you happen to notice that the dot.com bubble burst around that 6-mo period? I very, very seriously doubt that was anything but a coincidence. It's really not like your skills are out of date in 6-mo, as I'm still impressing some very higly paid pros with lots of stuff I was doing a decade ago. I wouldn't even note the gap on my resume, and I've yet to find a company that cares enough about about minutae to track down exact employment dates, rather than just confirming rough details, and making sure your references aren't giving an unenthusiastic endorsement.

      • by Ossifer (703813)

        Tech unemployment in the Bay Area is currently 3%. Fucked.

    • Re:Average (Score:4, Insightful)

      by DoofusOfDeath (636671) on Friday January 06, 2012 @11:03PM (#38618442)

      No offense intended, but generally speaking a sizable portion of the group will be paid below average. Perhaps you're just part of that group?

      • Re: (Score:3, Informative)

        by hedwards (940851)

        Yes, but if they're just reporting an average salary half of the people will be getting below average salaries. It's a lot more informative if you get mean, median and standard deviate. Preferably with some indication of how the samples are distributed.

        A mean alone is of very little value unless you've also sorting things in a way that makes sense. For instance a mean that covers the entire country is going to be somewhat worthless as one could be making a good salary in one part of the country and effectiv

        • Exactly. In Hollywood, CA, you are paying $1million USD for mortgage a one bedroom living space, where in rural PA, you could pay $40k USD for a 4 bedroom, 3 story house.
          • Exactly. In Hollywood, CA, you are paying $1million USD for mortgage a one bedroom living space, where in rural PA, you could pay $40k USD for a 4 bedroom, 3 story house.

            I don't think either of those things are true.

        • Re:Average (Score:4, Informative)

          by timeOday (582209) on Friday January 06, 2012 @11:42PM (#38618674)
          And of course "IT" is a nebulous job classification in the first place. It's almost like measuring the average pay of "health care workers" (which range from orderlies to brain surgeons).
        • Re:Average (Score:5, Informative)

          by Anonymous Coward on Friday January 06, 2012 @11:56PM (#38618762)

          "Yes, but if they're just reporting an average salary half of the people will be getting below average salaries."

          Nope. Given the usual pay scales, far more than half the people will be getting below average salaries. Exactly half the people will be getting below the median salary. Different things.

          • by artor3 (1344997)

            "Yes, but if they're just reporting an average salary half of the people will be getting below average salaries."

            Nope. Given the usual pay scales, far more than half the people will be getting below average salaries. Exactly half the people will be getting below the median salary. Different things.

            No, far more than half the people will be getting below the mean salary. The word "average" can refer to mean, median, mode, or other things.

            If you're going to be pedantic, check a dictionary first.

      • generally speaking a sizable portion of the group will be paid below average

        nearly half!

        • by sjames (1099)

          Well more than half. There's typically a few management types at the top skewing the curve.

    • The average is going up because all the lower end IT positions are over seas mostly now, at least that is my guess. I always found these 'average' salaries to be very misleading. Because I always seem to be making below the average.

      Same here. I look at IT salary statistics, even ones drilling down to "software engineers" or "software developers" and I end up crying. Sure, I live in a part of the country with a lower cost of living, but so do most people in my career. Am I really getting the shaft that bad?

    • by hemp (36945)

      The number if IT workers admitted on H1-b visas is also at a 10 year low.

    • by AuMatar (183847)

      It also depends on what exactly your job is. As a programmer, I make double that with stock. It's actually not too far from what I made at my first job ten years ago. Help desk will make far less. Lumping everyone together makes these surveys useless. It's like averaging nurses with surgeons and reporting an average "medical field" salary. Pointless, noone makes that- they make far more or far less.

  • My Salary (Score:5, Interesting)

    by bored_engineer (951004) on Friday January 06, 2012 @10:23PM (#38618156)
    Now I just wish that *my* salary would move back up to 2008 levels. To be fair, I was laid off in 2009 and needed to change specialties in order to find work. Fortunately, I have an immediate opportunity to move up, and may be able to get myself back where I was within a year.
  • Please... (Score:4, Informative)

    by tak amalak (55584) on Friday January 06, 2012 @10:25PM (#38618166)

    Please let my boss know.

    • by Anonymous Coward on Friday January 06, 2012 @10:40PM (#38618288)

      Your boss isn't going to go out of his way to pay you more than he thinks he needs to in order to retain you. The only person who will always have your best interests at heart is you. YOU must ask your boss for a raise and present evidence that your market value has risen to justify it.

      If he doesn't pay up, jump to a new job that will. Apparently, there are some openings now.

  • All those employees who were replaced by cloud-sourcing are now getting back to business - smart, simple, administration for less than you pay your average accountant to cook the books.
    • by dadioflex (854298)
      All? Those? Employees?

      No. Different employees are getting different jobs. Those other jobs? Those jobs are gone. It's dynamic.
  • I really have to relocate to the US.

    Seriously, people, is that figure for real?

    • Re:Hmm... (Score:5, Insightful)

      by russotto (537200) on Friday January 06, 2012 @10:34PM (#38618246) Journal

      I really have to relocate to the US.

      Seriously, people, is that figure for real?

      Yeah, with two caveats.
      1) That assumes you have a job. Lots of unemployed IT people and IT people working in other professions aren't counted.
      2) A lot of these jobs are in high cost of living areas like New York City or Silicon Valley. When a 1BR apartment costs north of $2000/month, $80k/yr gross doesn't seem like so much.

      • by evilviper (135110)

        Only 2?

        3) Higher salary puts you in higher tax bracket as well... I'm actually comtemplating going back to a job that paid half as much as I'm making now, because after increased taxes and higher cost of living, I have very little extra take-home to show for the miserable working conditions.

        It's amazing how housing prices can increase/decrease by more than an order of magnitude within a 30 minute drive.

    • If you are a programmer in the San Francisco area, you can easily pull down $100,000 - $150,000. Cost of living is more expensive too, but you can still save a LOT of money if you are careful.
      • by zz5555 (998945)

        And you can make more outside of the San Francisco area (or, at least, I could - YMMV). Don't get me wrong. I loved living in the Bay area, but when I got the offer for more money (and a more interesting job) in a place where I could buy a house twice as big as my Fremont house (and for less money with a much shorter commute), I couldn't pass it up. I always thought that I'd gotten premium pay for working in the Bay area, and putting up with the high prices and long commutes, but it turned out not to be

        • lol come on, you can't go on with a post like that, talking about what a great place you moved to, and not tell where it is!!
  • The Orwellian Truth (Score:5, Interesting)

    by msobkow (48369) on Friday January 06, 2012 @10:29PM (#38618206) Homepage Journal

    And my compensation package in 1999 was roughly $80,000/year. Things have improved how? Those numbers are still LESS than I made 13 years ago!

    Wasn't it in 1984 that someone was told to say the government increased the chocolate ration to a lower number than previously?

    • by Anonymous Coward on Friday January 06, 2012 @10:33PM (#38618232)

      1999 was in the middle of the dot com bubble. You might as well be a real estate agent complaining you aren't making as much as 2006.

      Also, I have no idea what technology you worked on then compared to now to assess your statement.

      • by msobkow (48369)

        The "bubble" was a sham and an excuse to cut everyone's pay. Nothing more.

        The only people who weren't needed after Y2K were the mainframe programmers who'd upgraded the old systems. I and all but two people on a team of twenty were on projects that had NOTHING to do with Y2K and were kept on LONG after that.

        But not before we all got raped into taking a forced pay cut. My staff were NOT happy when I presented them with their pay packages, renegotiated on an entirely one-sided basis: take it or leave.

        • by msobkow (48369)

          Every single employer in the region did this. Not just J. P. Morgan. Everyone. Even "new" industries that had no legacy systems.

          • by msobkow (48369)

            Shortly after I said "Fuck the US" and moved back to Saskatchewan. Thank God I left before the TSA started groping people on subways at random.

      • by msobkow (48369)

        Here's another few points to consider:

        • Delaware has a relatively low cost of living, so people doing the same job in some districts were getting paid $120K+
        • My staff covered the full range of technologies in use in the industry at the time: C, C++, Sybase ASE, Oracle, Encina, PegaSystems, AS/400, Powerbuilder, Java, Web -- the full gamut
        • Only two mainframe programmers were laid off. They were the only ones working on Y2K projects.

        I had to move back to Saskatchewan for health reasons, but not until I go

        • by msobkow (48369)

          No one ever seems to get away without being screwed by American greed. Personally. No matter where they come from. No matter how skilled they are. No matter their ethics. Anything to feed the executive and shareholder payroll.

    • by Opportunist (166417) on Friday January 06, 2012 @10:33PM (#38618242)

      We have managed to increase the decline of productivity!

    • by bieber (998013)
      You do realize that average statistics aren't based solely on your individual salary, correct?
      • by msobkow (48369)

        As a staff manager, I knew what other people were being paid. My salary was very typical across a pretty broad range of experience levels.

        And so what if it was the tail end of the Y2K bubble? That means people should still be getting paid less after 13 years of inflationary pressure on their actual disposable income?

        Drink that government Koolaid. All is right with America. Just trust The Great Leader.

    • by dadioflex (854298)

      And my compensation package in 1999 was roughly $80,000/year. Things have improved how? Those numbers are still LESS than I made 13 years ago!

      Wasn't it in 1984 that someone was told to say the government increased the chocolate ration to a lower number than previously?

      Ah. This article isn't about you. It's about average IT professionals, in the real world. When the Narnia survey hits we'll let you know.

      Seriously though. I am concerned about people who think that average salaries going up is a good thing. Imagine a system where if YOUR pay goes up, everyone's pay goes up and suddenly you're paying ten dollars for an apple. Who's better off? There's the world now.

      • by hedwards (940851)

        I'd like to live in such a system as it's better than what we have currently. What we have currently is a system where most people's income goes up less slowly than inflation and the various costs of living and a tiny minority's income sky rockets during a recession.

        Compared to your alternative where ones income would be going up at roughly the same rate as inflation, I know what I would take.

  • by DoofusOfDeath (636671) on Friday January 06, 2012 @10:48PM (#38618340)

    According to the inflation rate calculator I used, the consumer price index (one measure of inflation) has increased 5.08% from 2008 to 2011.

    So, on average, IT pro's are effectively paid about 5% less than in 2008.

    • Quick! corporations need more cheap foreign labor to suppress wage increases, Call Bill Gates to testify before congress again!

    • According to the inflation rate calculator I used, the consumer price index (one measure of inflation) has increased 5.08% from 2008 to 2011.

      Sounds like it's based on CPI, so it doesn't account for food doubling/tripling or the cost of energy.

      'Cause real people don't have those expenses...

  • by prisoner-of-enigma (535770) on Friday January 06, 2012 @10:52PM (#38618366) Homepage

    I've noted two trends in the job market lately: the jobs are paying a good deal more, but there are a lot fewer of them. It seems counter-intuitive because an oversupply of candidates would tend to drive wages down. However, what I see happening is companies almost *want* to pay top dollar...but only because they want absolutely stellar, walk-on-water, can-do-no-wrong, all-that-and-a-bag-of-chips candidates. I'm making *more* than I was during the dot com bubble. I'm also working my ass off managing projects that would've taken a team of people to do a few years ago. They're certainly getting their money's worth, but I have no room to complain because I'm making top dollar. And that's just how they want it: I have no incentive -- and no opportunity -- to jump ship for something better paying because I'm already way above the average wage, and a less stressful position would pay me so much less that it's not worth searching for.

    • i dont know what happened! we payed like 1000 guys top dollar to run society, and then all of a sudden these unwashed masses show up, screaming about 'food' and 'medicine' and 'water'. the fuck? maybe if we just payed them MORE, they would do a better job, and all the masses would shut up.

    • by Nethead (1563) <joe@nethead.com> on Friday January 06, 2012 @11:34PM (#38618616) Homepage Journal

      I'm making about a third of what I was making in 2001. Back then I was a stressed out asshole. I was responsible for keeping A large "bookseller" connected to the Internet and making 6 figures. After a string of jobs doing much the same, I burnt out. I'm glad I put my money into a fixer-upper in a good neighborhood. Sold that for a nice profit and now own a smaller home with no mortgage. Now instead of sitting at a desk playing George Jetson I'm out in the field fixing problems for people. Not big problems, more of the get the credit card machine working again or upgrade the VPN router type. 2-4 jobs most days, just drive there in my car. I get to meet all sorts of folks, save the day and on to the next job. Sure, I could make much more but my sanity and well being is worth than the pay cut. I'm happy, my wife is happy, and I don't get calls at night when something breaks.

      Prisoner, I hope you're still young and have time to save money so you don't have to stress all your life. The cubical can eat your soul. Plan so you can have a way out someday.

    • It makes sense that companies would want to pay top dollar for stellar software developers, given that (I would assert that) the variance in developer quality is generally greater than the variance in developer pay. Presumably this extends to other positions and fields too.

      It's all about bang for the buck, and if you can get someone three times as productive as an average developer (for some reasonable definition of "productive" and "average") by paying that person two average developers' salaries, it's th

    • by mini me (132455)

      I've written about this before. There is no incentive for companies to hire anyone except the very best. If the best are too busy, the companies can just wait it out until they become available. Unlike sectors that have been major employers in the past, like agriculture and manufacturing, where the is a physical demand to get the job done now, information-based jobs have no such limitations.

    • by mcrbids (148650)

      I see a similar thing here. We're a small software company and we're providing top notch enterprise-scale solutions as fast as we can bang them out. It almost seems that our attempts to slow things down by raising prices only increases demand and we're gasping to keep up.

    • by Tablizer (95088)

      I have no incentive -- and no opportunity -- to jump ship for something better paying because I'm already way above the average wage, and a less stressful position would pay me so much less that it's not worth searching for.

      And with all that extra money you can buy Maalox, Tums, Excedrin, and sleeping pills for the stress.

      If you value money above all else, it's what you'll get.
         

  • CS is not a different way of saying Software Engineering. CS is about how computing works and more efficient ways to do it (like improving the algorithmic efficiency of sorting), not about how to efficiently and effectively produce 1 000 000 lines of code dedicated to special case X (e.g. flying a plane). Some fields are like that, there's a difference between being a physicist (perhaps a mathematician might be more accurate even in some contexts) and an engineer too.

    • by JimboFBX (1097277)

      odd, my cs degree had a software engineering class

    • by Hadlock (143607)

      Then CS and SE need national level organizations and professional licencing associations in every state like medical doctors, lawyers, architects and electrical engineers do. Because every time someone says "I'm a CS major" or "I'm a SE major" half the people (particularly the non-technical ones) mentally roll their eyes and think "computer programmer" or "web master".

  • The tech / IT feld needs the apprentice systems so people can get the skills to do the job and so we have people who know what they are doing. Tech school is a good starting point but for most tech jobs 4 years CS is not.

  • by spiffmastercow (1001386) on Friday January 06, 2012 @11:33PM (#38618614)
    Arg.. Just pisses me off even more about the federal pay freeze. I'm a lead developer and project manager making $10k less than the average developer, who has no management responsibilities. It's getting harder and harder to justify staying in the public sector..
  • by Jane Q. Public (1010737) on Saturday January 07, 2012 @12:21AM (#38618906)
    Salary surveys suffer from the worst of all maladies that surveys can suffer from. Everything from self-selection bias to mis-reporting. Face it: compared to other kinds of surveys, NOBODY reports their salary accurately. Even worse, many who have low salaries never even participate.

    I'll believe it when it hits my own pocketbook.
  • by melted (227442) on Saturday January 07, 2012 @01:00AM (#38619132) Homepage

    But do heed the advice: get off your ass and change jobs every now and then. I changed jobs twice during the crisis. Good people are always in demand. If you want more than sub-inflation raises (or no raises at all), get off your butt and see if you can find something better. With luck, you will. If you don't try, you definitely won't. As simple as that.

    • by evilviper (135110) on Saturday January 07, 2012 @06:42AM (#38620430) Journal

      I changed jobs twice during the crisis. Good people are always in demand. If you want more than sub-inflation raises (or no raises at all), get off your butt and see if you can find something better.

      I agree with this part. I've drastically increased my pay by switching jobs in the past few years.

      With luck, you will. If you don't try, you definitely won't. As simple as that.

      Big word of warning... If you post a resume to job sites, expect an absolute FLOOD of horrendous and useless calls from Indian "recruiters". If a single word in your resume matches any keywords for a job, expect a couple calls about it. Doesn't matter what job you say you're looking for, doesn't matter if you checked that you aren't willing to relocate.

      I averaged a dozen calls every day for over a month after updating my resume on a couple job sites. I've gotten hundreds and hundreds of e-mails, and all of a handful have even been possibilities (right job title, not two states over). Large states are the worst (California), because these useless foreign idiots that call themselves recruiters don't check a map, and just assume if it's in the same state, it's a reasonable driving distance, and that's even the ones who are (barely) trying... I get spammed about jobs all over the country.

      This is a new phenomenon to me, and seriously risks making posting your resume a fool's errand, or worse. It's so bad that just posting your resume with a cell phone number runs the real risk of causing you to lose your current job as you are inundated with calls.

      Worse, employers are getting flooded by insane numbers of resumes from completely unqualified applicants. The weapon of choice seem to be requiring a recruiter to meet candidates in person before submitting them for consideration, which is quite the nightmare when your recruiter could be located 200 miles away... suddenly you need to take a day off work just to be allowed to SUBMIT a resume for consideration, which is the case with a number of companies. And just watching job sites doesn't work, as a huge number of jobs aren't ever listed on such job sites.

    • So, once again, we have a lottery winner brag and advice everyone to play. This might sound insensitive, good for you that it worked out, but it was not because you were "good", and other people may be much less lucky. Given the way most companies treat employees nowadays, if, God forbid, they get a wind of you looking for another position, through either posting your resume on the jobs site, or just expressing your interest on social network or privately, you will be on their shitlist and be dropped like h

  • Not just one number (Score:4, Interesting)

    by PopeRatzo (965947) * on Saturday January 07, 2012 @01:14AM (#38619210) Homepage Journal

    Salaries going "back to 2008 levels" does not take into account the benefits that you have all lost. Every one of you is paying more for health care, higher deductibles, higher co-pays. Your employers don't contribute as much to your measly 401ks that won't be nearly enough to retire on anyway.

    Don't get me wrong, it's good that there are signs of life in the economy, but we've got 2 percent growth and 4 percent continual federal stimulus. If the federal government should stop the stimulus, you're going to lose ground in a hurry. This isn't going to change in 2012 or 2013 or 2014 no matter who is elected. There are structural problems in the US economy, in the WORLD economy that aren't going to change and there really isn't any path to improvement as long as a relative handful of transnational corporate entities and bank holding companies continue to act as a self-appointed world government.

    • by oatworm (969674) on Saturday January 07, 2012 @04:28AM (#38619978) Homepage

      There are structural problems in the US economy, in the WORLD economy that aren't going to change and there really isn't any path to improvement as long as a relative handful of transnational corporate entities and bank holding companies continue to act as a self-appointed world government.

      Oh, it's much worse than you think. Much worse.

      If the companies you're thinking of actually acted as a self-appointed world government, we wouldn't be in the mess we're in - they'd at least try to make sure their own backs were scratched, if nothing else. The trouble is, nothing any of those banks own is actually worth anything. To use a programming analogy, our entire financial sector is abstracted into oblivion. Every single "asset" on the books is tied to some value extracted from another "asset", which in turn is tied to some value extracted from yet another "asset", that, 15-20 links later, eventually leads to actual collateral. This is due to our banking sector deciding at some point that it could get better returns reselling every scrap of paper they bought among themselves to each other than they could by investing their money into capital creation.

      To better explain this, pretend you're on an island with two other people. One of you is good at hunting pigs. Another one is good at harvesting coconuts. A third is good at fishing. Between the three of you, you all make enough food to feed everyone, frequently with a bit left over. However, each of you gets bored with what you get, so everyone decides to trade with one another. Trouble is, nobody can decide, say, how many pounds of pig a coconut is worth. So, the three of you decide to use a small shell on the island as money. It's colorful and thus easy to identify, it's rare, and it's portable. Perfect!

      One day, you decide you want a week off from your pig hunting duties. So, you start hoarding shells to save up for your week-long vacation. You charge a bit more for your pig than usual, you buy a little less fish and coconut than usual, and you spend more time between pig hunts looking for shells. Finally, you decide you have enough saved up where you can take the week off, so you do so. You stop hunting pigs and immediately start using your hoarded shells to buy coconuts and fish.

      Sounds good so far, right? Well, here's the thing - since you're taking the week off, food production just went down 33%. On top of that, the number of shells being exchanged between the three of you is the same as it was before you took your week off, only there's much less to buy. In short, everyone on the island - yourself included - is screwed.

      So, what does any of this have to do with the banking sector? Well, instead of investing in, say, fish preservation techniques, salted pork, better fish hooks, or a longer stick to whack the trees bearing coconuts with (i.e. capital improvements that benefit everyone), they've been investing in shells for the past generation or so and now we're all paying for it. Fun times, eh? But don't worry - maybe if we replace the shells with "sound money", maybe some shiny rocks, this sort of thing won't happen again. We promise.

  • ... that the average income of everyone excluding the top 20% is approximately $48,936, and unless you are in the top 20%, this is more in line with the salary that you can expect to see.
  • by Tangential (266113) on Saturday January 07, 2012 @11:10AM (#38621438) Homepage
    IT jobs and pay seem to be booming in the Atlanta area and it seems to be a market where corporate jobs are paying as much as riskier consulting jobs. Folks with average to good skills are finding work easily and companies are loosening the purse strings on long delayed IT projects. Our small consulting firm of 75 has brought on 8 people in the past 6 weeks. This observation is based on what we see on the job boards and in the hiring process and what we hear colloquially from other firms.
  • by DaveGod (703167) on Saturday January 07, 2012 @12:04PM (#38621846)

    Did I miss whether these are "real" (inflation adjusted) figures? It's the critical factor as the salary squeeze is coming from inflation reducing the value of money which has not been offset by salary increases.

    The article also errs significantly by using inconsistent terms for almost every single figure. "average boost", "average total increase", "total pay", "salary increase", "earn more", "total average compensation", "total salary", "take home", "make". I suspect the author is trying to avoid being repetitive with words but all of these words either mean different things or are vague and could mean many things.

    Sure, I'm an accountant and maybe most people are quite reasonably going to interpret as intended, but it shows the author does not have knowledge of what he is talking about. "Salary" means the top number on the payslip, "take home" means the bottom figure in your payslip that goes into the bank, while "compensation" is the top number plus all benefits and bonuses. The differences on the basis used can be substantial, especially when you're analysing small movements of around 5%, never mind the 0.81%. A 5% salary increase could easily be wiped out by cuts in non-salary compensation and is a cut in real terms if not adjusting for inflation.

    The relevant consideration is remuneration or compensation, in real terms. These account appropriately for benefits in kind, deductions and bonuses. You can get away with ignoring that in normal times by assuming there isn't much movement, but in current times it's a widespread way to cut payroll costs without hurting the headline salary rate.

    Even then, if your pension is a money purchase scheme we're only looking at pensions in terms of the employer contributions. You personally are very likely still much worse off due to the fall in the current value of your plan and the fall in it's expected growth rate. Usually this will be through no fault, action or inaction of your employer, but nevertheless you're losing out due to the economic conditions. Furthermore this should put upward pressure on salaries as workers seek to increase contributions while maintaining their take-home pay. Even if all else was equal except that salaries were increased to exactly offset increased contributions which were set at a level to exactly offset the pension plan decline, the figures would arguably be misinterpreted because while yes they would accurately show an increase in compensation offered by employer, there would be a nil change in compensation enjoyed by the employee. This matters when you start calling people "winners" when actually they just lost less than the others.

  • by billybob_jcv (967047) on Saturday January 07, 2012 @12:12PM (#38621914)

    ... than I did in 2008. I left a good, but boring job to go to a company that hired me to manage a big ERP project, then a week after I started they canceled the project and 7 months later I was laid-off. I was an idiot that let a weasel of a CIO completely fool me. It took me almost 5 months to find a new full-time gig and a 20% lower salary was the best I could find in Southern California.

    Companies are using contractors and temps more than ever before, and because of the number of people still out looking for jobs, they are paying less for those resources than they have in many years. So, the placement firms are offering much less to the contractors - with absolutely zero insurance & benefits. From the perspective of your average CIO, he doesn't need to invest in his internal staff - he can just bring in contractors that he can swap in and out based on the specific tech skills he needs. When the project goes wrong (which it will when it is staffed by people who know nothing about your business) he can blame the contractors and the project manager.

    Even the small internal IT staff that is kept for maintenance & local sysadmin duties is not immune - there is no reason to invest in their training and career path - you can just swap them out whenever you decide to change technologies. If you are replacing Goldmine with Salesforce.com, don't bother training your current staff (that has given you many years of excellent work) on Salesforce - just lay them off and hire people who already know Salesforce.com, then repeat & rinse in a few years when the next shiny new toy is released.

    Bottom line: Now, more than ever before, IT employees are considered tech monkeys that can be swapped out and "traded-up" (a term used by my last weasel of a CIO) just like the HW & SW they work on. That might be OK for young, single IT geeks - but not for people who are trying to provide for their family. Get out now, while you can!

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