Tory Brown was reasonably happy in his third year as an IT help desk engineer at Privia Health Group when a recruiter contacted him in May. The Hive Group, a government contractor headquartered in Ashburn, Virginia, had an offer with greater responsibility and a roughly 15% salary bump.
“I wasn't looking to leave Privia, but if the right opportunity came along, I was going to have an ear open for it,” said Brown, who earned his bachelor’s degree in communications in 2013 and completed a CompTIA A+ certification before entering the IT workforce in 2016.
Money wasn’t the only reason Brown switched jobs — but it didn’t hurt.
“I was a little antsy: I wanted to learn more, and I wanted the possibility of earning more,” he said. In addition to a higher salary, Hive is paying for the continuing education credits Brown needs to renew his A+ certification and earn two additional CompTIA credentials (Network+ and Security+), as well as Microsoft and Linux certifications.
Brown’s experience reflects a larger trend in the market for tech talent. Across the board, salaries in tech professions have risen 6.9% in the past year, with some positions — including web developer, technical support engineer and database administrator, and data analyst — leading the pack with double-digit growth, according to a survey by IT career marketplace Dice.
Most IT roles saw year-over-year growth in 2021
“This is the largest percentage increase of any year in the history of our survey instrument,” said Art Zeile, CEO of DHI Group, Dice’s parent company.
While unprecedented in scale, the spike in salaries is rooted in the most basic of economic principles: supply and demand.
IT upgrades and build-outs put on hold during the pandemic resumed in 2021. Companies committed to larger, more aggressive investments in tech that helped overcome disruptions of the previous year — AI, analytics, automation, cloud. Meanwhile, the supply of talent to implement, operate and manage these technologies did not keep up with demand. As competition for talent increased, so did salaries.
While the surge may level off over the next year, salaries are expected to remain high.
Wages for tech workers were already on the rise, according to Bureau of Labor Statistics data and CompTIA’s annual State of the Tech Workforce report. The median wage in tech rose to $94,058 in 2020 from $86,852 in 2019, an increase of 8%.
Some of that increase is due to organic growth rooted in modernization efforts underway pre-pandemic, according to Tim Herbert, CompTIA chief research officer. But that’s not all of the whole story. Postings for open tech positions were up 62% from June of last year, according to CompTIA’s June 2021 jobs report.
There are simply more companies hiring, and there's more technology used across business functions,” Herbert said. “That translates to a need for more workers.”
Great resignation, great reshuffling or great reflection?
The simple math makes sense. More technology requires more tech workers. This accounts for an expected gap between a relatively stable supply and growing demand for talent. Complicating matters are reports of a Great Resignation and the possibility some workers are opting out altogether.
With 80,000 tech workers added in 2021 and another 178,000 projected this year by CompTIA, it’s clear the workforce isn’t shrinking. The resignations, Herbert said, are more likely a great reshuffling, as tech workers are lured away by the promise of larger salaries.
CompTIA saw an uptick in the number of tech professionals exploring and/or considering new job opportunities in the past year. But, rather than leaving tech, they appear to be looking for better jobs within the field, according to Herbert.
A “great reflection” is the term preferred by Lily Mok, Gartner VP and analyst. As more jobs come on the market, there are more choices, prompting workers to reexamine their level of job satisfaction.
“It's not just about pay, but also the whole experience associated with growing your skills and getting what you need for your personal interests and career path,” Mok said.
As companies institute return-to-office policies, some tech workers are looking for jobs that offer more flexibility. Windowed work, which gives employees latitude in scheduling their day, has become a more common perk, according to Brittany Nisenzon, a Philadelphia-based metro market manager for talent recruitment and HR consultant firm Robert Half.
Computer science graduates doubled in the last decade
In short, it’s still a job hopper’s market.
There almost certainly are plenty of help desk personnel eager to move up the IT ladder.
“I have friends that I left on the service desk at Privia who are now more willing to look for new jobs because they know that these jobs are out there,” said Brown. “Some of those jobs will just come across your path, like mine did.”
A leveling effect
Growth and demand patterns are typically asymmetrical in tech, varying by geography and sector. However, salaries are experiencing as much and, in some cases, more growth in emerging tech hubs, according to the Dice report.
In Seattle, for example, salaries were up 11.2% in the past year, a rate exceeded by Pittsburg (14%), Atlanta (13.9%) and Miami (11.4%).
The option of working for a company in a tech hub while living in a city with a relatively low cost of living is one potential benefit of an environment — and an economy — that supports remote work.
“When a remote technologist in Kansas City is being paid a comparable rate to their teammate in Portland, [Oregon], that could help close the ‘geography gap’ that’s existed for several years, where technologists in mature — and expensive — tech hubs such as Silicon Valley and New York City earn quite a bit more than their professional colleagues with similar skills in other cities,” said Nick Kolakowski, senior editor of Dice Insights.
Similarly, salary increases have taken hold across the tech workforce.
DHI Group tripled its recruitment contract with Amazon in the first quarter of 2022, according to Zeile, but the majority of its clients are not in the tech sector.
“Companies like Disney, Bloomberg, and Home Depot, they’re all trying to hire technologists in large numbers,” Zeile said.
A salary plateau on the horizon
Workforce growth in tech was projected to be roughly 2% this year by CompTIA, and Herbert said he is still comfortable with that number. A dip or, more likely, a period of plateauing as a normal part of the business cycle would align with that analysis.
With rising inflation and interest rates fueling recession fears, the unemployment rate for tech workers rose to 1.8% last month, according to a CompTIA review of Bureau of Labor Statistics monthly data.
Some analysts have begun scaling back 2022 growth projections. The IT consulting firm Janco Associates has updated its estimate for tech jobs added this year to 196,000, which would constitute a drop from 213,100 in 2021.
But many companies already set modernization plans in motion. A growing tech workforce will be needed to see those plans through and, currently, the tech workforce can’t meet that demand. America needs a larger talent pipeline.
The number of graduates from bachelor’s and master’s programs in computer science has grown steadily over the last several years, to nearly 150,000 in 2021 from just over 100,000 in 2016, according to an analysis of Department of Education’s National Center for Education Statistics data. But that’s not enough.
Sourcing IT talent from overseas could expand the pool of candidates, but there are short-term obstacles. Restrictions imposed in 2020 on the H-1B visa program, which could ease some of the pressures, remain in place.
“We're still in the same fundamental position where we're not producing enough tech talent in the United States, and we’re not able to import it from overseas,” Zeile said. “That supply-demand gap is creating this pricing pressure.”
That pricing pressure is likely to keep salaries high through the end of the year.