Despite a soft economy, those employed in the information technology field can safely expect a raise in the New Year.
According to The Toronto Board of Trade Compensation Series for information technology, employers in the GTA are predicting a 3.3 per cent average increase to base salaries for IT professionals in management positions and a 3.2 per cent increase for non-managerial employees.
The median total compensation for IT managers is pegged at $90,000, according to the survey.
The IT compensation survey is one of five the Board of Trade (BoT) conducts annually. The information is gathered in the spring of every year. As a result of the downturn in the economy and as a result of the events of Sept. 11, the BoT conducted a “flash survey,” says Andrew Labute, vice-chair of the Toronto BoT’s compensation surveys committee. Survey participants were contacted a second time to see how the downturn and Sept. 11 changed their plans for the coming year.
Prior to those events, the study found that IT professionals in a management position could have expected a 3.7 per cent average increase to their base salary, while non-managerial IT employees would have seen a 3.8 per cent average increase.
Last year’s study did not break down IT employees into two separate categories. Overall, participants were predicting a 3.9 per cent raise to base salary for the year 2001.
Labute says it’s difficult to say if the results are typical because the entire IT industry is in flux across North America. “It is, however, reassuring to know that most organizations are still planning on giving increases,” he said, “even if they happen to be a company that is downsizing, that they are recognizing that they have to retain their key people once they’ve done their downsizing.
“Not all companies are downsizing and you still want to hold onto your star talent.”
According to the study, about 40 per cent of employers are using training for future needs as a recruitment or retention strategy, compared to 33.8 per cent the year before. Labute says that number is higher compared to most other industries. “Given the nature of information technology positions, people need to feel that they are being trained for future needs.”
Despite the economic slowdown, the survey found that cash bonuses and individual incentive bonuses are still common types of bonuses awarded to IT professionals. “No matter what they’re trying to do to their organization,” said Labute, “it’s very difficult to take something away. It’s almost unheard of unless the company in question is in severe difficulty.”
Labute said the value and the number of bonuses would likely fluctuate from company to company. “Companies that may have been doing signing bonuses last year may not be doing those this year. It really depends how sophisticated the company is and how sophisticated their compensation structure is.”
Stephen Mill, senior regional manager with RHI Consulting in Toronto, said that while training can be an effective tool for recruiting and retention, it has to be very current because many IT professionals tend to teach themselves the latest skills required for the jobs on their own time.
Mill added that employees might be willing to give up cash bonuses and incentives for job security. “People are willing to accept less.”
But while some employees may have job security top of mind, another report suggests IT workers are jumping ship of their own accord.
Aon Consulting’s 2001 Radford Total Compensation Survey, which charts employee turnover at Canada’s high tech companies, found that total average turnover, which includes layoffs, firings and resignations, was 22.3 per cent in the one-year period ended May 1, 2001. That compares to only 18.3 per cent in the same period the year before.
The survey’s reporting period encompasses the burst of the high tech bubble in the spring of 2000 and the subsequent decline in the North American economy. The Aon survey found that at a time when many bellwether firms are slashing thousands of jobs, the number of people voluntarily leaving their jobs rose to 14 per cent from 12.5 per cent last year.