If Tech Is So Important, Why Are IT Wages Flat? 660
dcblogs writes "Despite the fact that technology plays an increasingly important role in the economy, IT wages remain persistently flat. This may be tech's inconvenient truth. In 2000, the average hourly wage was $37.27 in computer and math occupations for workers with at least a bachelor's degree. In 2011, it was $39.24, adjusted for inflation, according to a new report by the Economic Policy Institute. That translates to an average wage increase of less than a half percent a year. In real terms, IT wages overall have gone up by $1.97 an hour in just over 10 years, according to the EPI. Data from professional staffing firm Yoh shows wages in decline. In its latest measure for week 12 of 2012, the hourly wages were $31.45 and in 2010, for the same week, at $31.78. The worker who earned $31.78 in 2010 would need to make $33.71 today to stay even with inflation. Wages vary by skill and this data is broad. The unemployment rate for tech has been in the 3-4% range, but EPI says full employment has been historically around 2%."
Because youre a bunch of cowards (Score:1, Insightful)
too afraid to ask for the raise, or to leave when they tell you no
Relative to other incomes... (Score:4, Insightful)
flat is rising.
Re:tech is a fairly broad category (Score:5, Insightful)
In my area (not US) if your skills have flattened so has your salary. If you grow and expand your abilties, there is plenty of room for growth.
BTW 80k to start in SF seems pretty horrible considering the cost of living there I dont find it surprising to command 6 figures after proving oneself.
Because (Score:5, Insightful)
Because IT stuff is easy. I mean, you just type some things and click a few buttons, right? That's not hard. Why do you need 100k a year to do that?
If cleaning toilets is so important... (Score:5, Insightful)
... why do they earn so little? Nobody wants dirty toilets.
Because of the old adage... (Score:5, Insightful)
Foreign pressure (Score:4, Insightful)
Get rid of the guest workers and offshore pressure, then wages can rise.
Cry me a river. (Score:5, Insightful)
Quit complaining- staying even is good these days (Score:3, Insightful)
Most middle or working class occupations are suffering from *declining* pay. Holding steady is good these days. And think of all the people who were making $50K or $75K a few years ago and are now working for $10/hour or less.
Here, I'll help:
1... 2.... 3... 4... 5... 6...
Count your blessings! :)
Re:Cry me a river. (Score:5, Insightful)
Yeah but the national median level of education, training, and experience is only slightly above a zoo monkey, so only getting paid a tiny bit more for knowing a heck of a lot more seems a bit out of proportion.
Competitive economy. (Score:4, Insightful)
Capitalism (Score:5, Insightful)
Because of capitalism. Those who do the real important work never get what they are actually worth, as it would cut into the profits made by executives and investors. The labor market cannot ensure that people get paid what they're worth--by which I mean the value they produce--because there's almost always someone willing to do it for less. We under cut each other fighting for scraps, and those at the top keep the bulk of what we produce. This is how capitalism works.
Maybe people are wising up. (Score:4, Insightful)
I am surprised that it has take the world so long to realise that IT salaries are overpriced. Because the hardware used to be so rare and expensive the people who used it and looked after it were also rare and expensive.Now that the hardware is cheap as chips, and the labor market is approaching truly global is it a big surprise that salaries are flat?
If a bad patch breaks my two year old $500 company laptop or a $200 tablet I am not going to pay somebody to fix it. I replace it and move my data over. There was a time when PCs cost thousands, and servers cost tens of thousands. People won't pay people $100/hr to fix a $200 devices.
I also imagine that it is a heck of a lot cheaper to engage off-shore programmers than using local resources (you can't do that for a truck driver...) - supply and demand in a free market in action.
Guess who gets all the benefits? (Score:5, Insightful)
This is common across all sectors and all skill levels.
The corporations have set things up so that the owners and managers capture all of the profit and any productivity gains. They have also bought enough politicians to keep their tax rates low so they don't have to contribute to the "general welfare". Corporate profits and upper management incomes are at record levels.
The situation with tech wages is the same as that with WalMart employees. You are expendable and replaceable and if you make trouble you will be fired so just sit down and shut up and get to work. At least tech wages are above poverty level so they don't have to go on Medicaid and food stamps to survive... be thankful for small favors.
The last time things were this far out of kilter was the 1930s and that gave rise to the union movement (as well as socialists and communists). This time, people seem more complacent and are just happy to have small crumbs.
you're working on the wrong hardware (Score:4, Insightful)
NEBS-compliant enterprise- or telco-grade systems still cost tens of thousands of dollars and people definitely pay people good money to work on them.
The company I work for is on-shoring work after figuring out that off-shoring it dropped the quality substantially.
Re:Relative to other incomes... (Score:3, Insightful)
Adding to that, they are comparing wages between 2000 and 2011. One is the peak of the dot-com boom, the other is now. If they compared between 2001 and 2011 or 2002 and 2012, they probably will have a different picture.
Their comparison is like comparing Banker wages between 2007 and 2011 and claiming that bankers are underpaid on a 5 year basis. In the case of bankers, they are paid more than twice average national wage in both 2007 and 2011, but compared to a boom they are not doing as well now.
Re:If cleaning toilets is so important... (Score:4, Insightful)
No really, part of the issue here is that if one underpaid worker tries to demand better compensation, they'll just be replaced with someone else who doesn't mind the low compensation. People are trained from an early age to believe that janitorial work deserves low pay, and so if they are looking for a job cleaning toilets they generally expect low pay.
If IT is so important... (Score:4, Insightful)
Important != Valuable
The cleaning crew is important. Long haul truckers are important. Neither are high paying jobs.
Every occupation thinks theirs is the most important, and deserving of higher pay. IT is no different.
Re:Because youre a bunch of cowards (Score:4, Insightful)
Not I, sir. I patiently wait for a raise, then leave when its apparent that I would have to ask to get it.
Re:tech is a fairly broad category (Score:2, Insightful)
My little sister went from a house with a yard in Texas to a quarter of a loft in San Francisco.
She says she'd do it again. Something about having actual culture that isn't about the size of your belt buckle.
Re:If IT is so important... (Score:4, Insightful)
The Morlocks need the Elois; the Elois need the Morlocks.
Price Fixing (Score:4, Insightful)
PHBs and credit (Score:4, Insightful)
Two (related) reasons that I have heard as to why IT isn't valued as much as it should be (I myself am not in the IT field, so this is more like hearsay):
Clueless PHB: This is partly the fault of those who work in IT not educating those higher up in the food chain. PHBs don't look on IT as producers, but as cost centers. So they try to skimp on hiring competent people. And the IT people don't have direct relations with the clients (in most firms), so when it comes time to decide bonuses or raises, IT is generally at the back of the line. While IT is what allows everyone else to raise money, the PHBs would rather look at a $60k fresher vs. a $120k experienced admin and ask why they shouldn't just outsource it for $45k. They don't see the downside in having a poor IT team even after it bites them (just fire one newbie and hire another in his place).
One admin I know used this solution (based on "You and Your Research" by Richard Hamming) after most of his team were outsourced (not because the team was bad, but because the PHB saw cost savings): everytime the outsourcing created a problem and someone tried to scream at him (he was their internal liaison to the external contractor) he told them to go tell PHB "we lost/cost $X extra because the contractor screwed up." Only when the PHB saw how much the "real" cost of outsourcing IT was, did he reverse the policy.
Taking Credit: As an old saying goes - the competent IT admin fixes problems before they happen. And then the PHB wonders why he is paying $X for new servers and infrastructure when the current system works fine. IT people should be more proactive about boasting about what they do. Sure, this is distasteful to lots of technical people. But guess what? Everyone else brags and lets their manager know (in a not so subtle way) of why they deserve more money: "I sold $YYY to MY clients". So the IT team needs to take credit for sales they help with. If an employee used a lot of resources to construct a portfolio for a client, it isn't all to the trader's credit. YOUR software and hardware helped him run simulations and generate the portfolio. So add THAT to your pitch. If one of the IT workers stayed up half the night so a client could get some figures/data - he should get credit instead of letting the suit tell the story. A knight wouldn't have killed the dragon unless he had a magic sword - but the armorer doesn't get any songs written about him.
The flipside is to be realistic about what you are doing - this isn't the dot-com boom. Don't expect riches for trivial work. If you do good/tough work, expect to be compensated as well (and let your bosses know why YOU are better than everyone out there). But if you just make a CSS/HTML page, don't try to claim you are God's gift to the firm.
Re:Because of the old adage... (Score:4, Insightful)
Plus the Engineer gets the satisfaction of actually being productive and making something instead of just being a leeching middleman. And no, "liquidity" is not a product.
Re:Capitalism (Score:2, Insightful)
Take it from someone born and raised under "developed socialism" - it was the same there too. In fact, the best mass occupation in USSR were taxi driver, waiter, butcher - because they dealt with hard cash. Engineers and programmers were making about 150 rubles per month in 1980s. Pair of jeans cost 200 rubles back then.
Whoever has modded your comment "insightful" is a cretin.
Re:Because of the old adage... (Score:4, Insightful)
Re:Do you guys really make that much? (Score:5, Insightful)
I don't know why you think coding on a large project is easy either. The skillset required is not easy to find, and there are a whole lot of assholes who can make a total mess of your project and cost you thousands in delays and additional work because they don't know what they're doing. That's one of the big reasons you don't see as much coding outsourced these days. 5 or 10 years ago everybody was doing it, and also discovering that the product they got back was of poor quality compared to stuff from their in-house coders. It is very expensive to fix bad code.
Re:tech is a fairly broad category (Score:5, Insightful)
That's ridiculous, $1500*12 = $18k a year. Subtract taxes from $125k and you should still be at about $80k.
That leaves you over $60k after taxes and rent. If you can't manage to pay your loans and live comfortably on that much money (while putting away a bit of savings at well) you are a spoiled brat.
At $80k sharing a nice 2 BR you are still talking $40k "to live on". You may not want to constantly drop $100+ a weekend on dinner and drinks, but ramen noodles my ass.
Re:tech is a fairly broad category (Score:5, Insightful)
two facts
the average ceo in 1970 earned $500,000 in 2000 it was $5,000,000
the average empolyee in 1970 earned $19.26 in 2000 it was $19.74
The exact numbers are off a little bit as I am going form memory the fact is unless your on the board of directors your pay has been basically flat. IT is just the lastest group to be shafted by corporate boards.
Remember it is perfectly fine for a company to fire 1,000 people and then pay the board those people's salaries as executive compensation. Wall street supports such moves by increasing your stock price.
perhaps part of the problem (Score:4, Insightful)
is that it's hard for a lot of managers to figure out who's valuable. Most smaller shops hire IT staff because they don't have the expertise in-house already. It's not like a cook that hires an assistant cook and can watch them and know if they are skilled or unskilled. I think most IT for smaller organizations are easy marks for unskilled IT, that can be incompetent and still appear valuable because the people doing the hiring and the managing can't properly assess a person's skills before OR after the hire.
And I think this hurts the average pay. I've seen this happen a lot around here, where idiots are working IT for someone and the idiot moves on, leaving behind the managers to think that they need to find a replacement "as good as Tim", and are completely astounded to find that their new hire Jason actually knows what he's doing and is a massive improvement. Leaves them wondering "were we paying Tim too much, or are we paying Jason too little?"
So now at least they know that good IT is worth paying more for, but the rest of the hiring pool out there that hasn't learned that lesson yet doesn't consider their IT all that valuable because they currently are employing an idiot and just have no idea how much more they could benefit from quality IT.
Re:tech is a fairly broad category (Score:5, Insightful)
Your sister sounds like someone that's never actually been in Texas. It's a little more diverse than Hollywood stereotypes (which you happen to be repeating) would lead you to believe.
Inconvenient Facts (Score:5, Insightful)
Want to cry in your soup?
For the middle class, real wages haven't risen since 1978. (chart [motherjones.com]). Of course the upper class has made out like gangbusters.
In other words, your buying power is the same as your Leisure Suit-wearing predecessors, whereas the rich have accumulated whole closets of never-been-used ivory-handled backscratchers.
Re:Because (Score:4, Insightful)
Well IT is fairly easy when everything is working.
However, when shit hits the fan the skillsets that an IT professional have plus the penchant that most IT Pros have regarding troubleshooting and diagnosis is invaluable. If your website is dead in the water you're not making any money. If your network is breached you arent making money, you may be losing valuable company secrets to your compeditors.
What is probably on the decline or 'flat' is the guy who takes your computer, wipes the spyware and viruses off it and gives it back to you. People with real IT skillsets are only going to go up.
Re:Quit complaining- staying even is good these da (Score:5, Insightful)
Last quarter the economy's profits grew quite a bit over previous quarters, however hiring remained flat. Quit complaining and work more hours, at least you've got a job right?
IT is the new factory worker. (Score:2, Insightful)
Anyone interested in continuing economic increases have been sliding in their career now. I left IT 6 years ago for Smart buildings and High end Corporate AV. I'm in high demand and can dictate my job perks and salary. I'm starting to learn something else as a lot of IT and CS people are now eyeballing my industry.. So it's time to learn and start the slide to something else before this field becomes a mess like IT has.
And no, I am not giving details, if you cant figure this out on your own, you are not smart enough to do the job.
This is a slice of a bigger phenomenon... (Score:5, Insightful)
Y'all are making excuses for a much larger phenomenon. The implosion of the middle class. Here's [advisorperspectives.com] a comparison of wage growth for Americans from 1967 until 2011. Look at the various jumps in the curve. You can see the big jump in the late sixties of the lowest quartile, the clear results of the war on poverty. The economic doldrums at the end of the Carter Administration. The sudden increase during the Reagan first term, but take special notice of how the rise benefits the upper quintile and even more so the top 5% (and if you could see the top 1% and top 0.01% I think you'd see something shocking.) The subsequent fall during the senior Bush Administration followed by the boom of the Clinton years (and make no mistake, the booms during both Reagan and Clinton involved huge economic expansions in industry, heavy industry for Reagan and information industries for Clinton. Then junior Bush's Terms, and here's where it get's interesting. Notice the steady decline in advancement. The majority of Americans are seeing their wages crashing towards stagnation or worse. In fact looking at the lowest quintile, over the last 10 years they've had a 20% drop in real wealth. Even the first quintile has remained stagnant with extreme fluctuation. So this is not just an IT thing. The only folks to see dramatic increase in personal wealth over the last 10 years I in a group smaller than the top 1%.
While that was going on, the real wealth of Americans at large has been disappearing. Here's a brilliant lecture on the looming collapse of the Middle Class [youtu.be] and the economic forces responsible for the situations we all face today. Contrary to pundits conversations Americans spend significantly fewer inflation adjusted dollars on food, clothes, appliances and cars. Where they are getting killed is Cost of Housing, revolving credit and loan debt, Medical Insurance and drugs, Child Day Care, Cost of Fuel/Energy, that and there are new expenses surrounding electronic gadgets that have been a steadily growing part of the cost of living since the late 80s.
The Banks (both in banking, loans and real estate), Big Medicine/Pharma, and Energy have put the American Family in such a precarious position, that any small disruption or disturbance results in almost immediate financial collapse. The critical events facing Americans are Death of a spouse, Injury or Serious Illness, Divorce and extended Unemployment. Any of these (singly or in combination) are enough to initiate a cycle of debt, penalties and ultimate bankruptcy. Add to this growing inflation and the erosion of our savings and investments, and you can see that the American Family is under extraordinary financial stress. The American dream for a growing population is just being able to get by.
Re:Because (Score:4, Insightful)
Re:Capitalism (Score:4, Insightful)
Re:tech is a fairly broad category (Score:3, Insightful)
Re:tech is a fairly broad category (Score:4, Insightful)
Re:tech is a fairly broad category (Score:4, Insightful)
I really fucking hate yardwork, so I personally wouldn't agree with that, though I agree plenty of people would.
You can spend a portion of the money you save by living anywhere else, hiring someone else to do the yard work for you. Then you have this other money you can spend too.
The California distortion field is strong on slashdot. For example, people that think its reasonable to pay $800K for a condo, and people that think $1400 is reasonable for a one bedroom apartment.
In almost the entire country, $1400 is more than a mortgage payment on a very nice house. If you live in California then the odds are very good that you don't really have a grasp of the typical cost of living anywhere else. This is why Californians cannot comprehend how someone could live on $45K/year (the national median) elsewhere in the country, or why $20/day is actually extremely nice pay in China putting Foxconn workers on the road to early retirement.
Re:Capitalism (Score:4, Insightful)
Do you hav 401k? Aren't you therefore an investor?
Nope. My 401(k) will be taxed as ordinary income when I go to withdraw from it. If I was an investor, it would be taxed as a capital gain.
Re:tech is a fairly broad category (Score:2, Insightful)
Despite what we are led to believe by the hit TV series Glee, drag shows are NOT culture.
Re:tech is a fairly broad category (Score:5, Insightful)
That's true: I used to live in California, but the taxes were too low for me, so I moved to Denmark. ;-)
Of course, now I actually get something for my taxes. I get 100% of my healthcare paid for, and great transit, among other things.
Re:tech is a fairly broad category (Score:5, Insightful)
>1500 for a two bedroom unit is steep compared to other parts of the country, but hardly unaffordable on $80k/yr.
It is if you are saving properly for a downpayment and a 401k.
Lose your sense of entitlement. $80K/year, -20K taxes, -18K rent = $42K/year. You are doing way better than most people.
So you want to exclude $15K pretax for your retirement and maybe $15K so you can have a downpayment in a few years? You still have $1K/month for food, drink, and fun. You are doing pretty damn well for a young person.
Re:tech is a fairly broad category (Score:5, Insightful)
Really, eating restaurant meals 3 times a day? That's part of your problem.
I also make $125k and likewise, my take-home is about $6100. I spend even more on rent for a 1-bedroom than you, and my student loans are higher, and I do just fine:
Leaves me $2750, much of which I can put toward paying off my loans faster, after which I'll start really focusing on saving. As for transportation, I walk to work. The central location is why my rent is so high, but I offset that by not having the expense of a vehicle. I get free public transit, but even if I paid for it, my transit trips would probably only cost me about $20/month. If I really want to drive somewhere, there's Zipcar.
I grew up in a working poor family, so maybe I just know how to manage money better than some people. As it is, I feel guilty about my $8/day lunches when I could probably pack my own lunch for $1/day. That's ~$150/mo I could be saving, all without any real decrease in quality of life.
And let me emphasize: that $2750 I'm left with is more than most people in this country gross. The median personal gross income in the U.S. as of 2005, among people over 18, was $24,062. Adjusting for inflation (I couldn't find current data), that's $28,500, or $2375 a month. Even if you look at the over 25 numbers (I'm under 25, btw, and I suspect you are, too), my spare cash after all my expenses still exceeds the median net income (though not quite the gross).
TL;DR: We have more disposable income than more than half the people in this country gross. Even with your wasteful spending, you have $1555 a month left, which is far more disposable income than most people in this country have. You have no reason to complain.
Re:tech is a fairly broad category (Score:5, Insightful)
It isn't just tech, it's all industries. Corporate profits are at an all time high, why hasn't any of this money trickled down to the average worker?
You'd think it was 1925 again.
Re:tech is a fairly broad category (Score:5, Insightful)
In car analogy, they would rather pay someone to take apart their car with a $200 set of craftsman tools and no experience, then take it to a mechanic who can do the same job at book rate in 1/4 to 1/10 of the time. They think it's a bargain because they are getting more hours, meanwhile less is getting done and it's getting done in the worst possible way.