In-Depth

2004 Salary Survey, Part 3: IT Follows Bicoastal Economy

The Northeast and West Coast continue to lead in IT compensation

For IT professionals seeking top dollars, it's best to seek out places near the water. The two coasts—and one in the middle—dominate as havens for IT managers and staff professionals seeking the most money for their expertise. Companies in the northeastern United States—with its constellation of major cities—offer the top IT compensation. Following closely are West Coast cities, with the Bay Area (stretching from San Francisco to San Jose) still serving as a top draw for IT talent—signaling a bounce from the post-dot-com malaise that gripped the valley.

In addition, while conventional wisdom dictates that the largest organizations will pay the highest salaries, there are some IT positions where size doesn't make a difference. Small firms still need to compete with large corporations for IT talent, and often will pay comparably.

These are among the findings of our survey of 1,130 enterprise-IT sites. We tracked salary figures for IT managers and professionals across a broad spectrum of organizations. A majority of respondents (54 percent) are managers of IT departments or principals with their companies. Our survey covered eight IT management positions, including chief information officers/vice presidents, IS directors, IS managers, application development managers, data center/operations managers, networking managers, help desk/support managers, and Internet managers/directors. (The results of IT staff positions are available in Part 1 of our survey, and IT managers in Part 2. Our job description page includes a list of the responsibilities of each position.)

The survey also covered seven IT line (staff) positions, including applications systems analysts, programmer/analysts, application programmers, system programmers, network administrators, system administrators, and database administrators.

In this report we examine IT salaries from both a geographic and industry-specific perspective. The survey divides the respondents into four regions across the country, as shown in Table 1. Table 2 drills down further to explore salaries across 12 major metro areas. Table 3 explores salary differentials based on industry groups, and Table 4 looks at the impact of companies size on IT salaries.


NORTHEAST

Overall, companies in the northeastern United States—defined as the region that incorporates New England and the Mid-Atlantic states (NY, NJ, PA, MD, DC) down to Washington, D.C.—pay the highest rates for most IT positions. Northeast rates top the rest of the nation in 10 out of the 15 positions covered in the survey, and come in second place for the remainder.

These high rates are in large part driven by IT salaries in the New York metropolitan area, which includes New York City, Long Island, the lower Hudson Valley area, southern Connecticut, and northern New Jersey. New York-area companies pay the fourth highest salaries among 12 metropolitan areas examined in the survey for upper IT management ($124,000), and the highest for developers/analysts ($74,000), and administrators ($79,500). Middle-management IT positions in New York companies come in fifth at $80,700. (Note: In the metropolitan rankings shown in Table 2, job titles are aggregated into general categories to compensate for smaller sample sizes.)

The Northeast also includes such heavyweight cities as Boston, Philadelphia, and Washington, D.C.—all of which pay above the national average found in this survey. In fact, while C-level salaries are relatively low within the Washington, D.C. metropolitan area, IT middle management and staff positions ranked among the highest in the country. The Boston area also has high IT salaries, particularly for administrator positions.

SOUTH/SOUTHEAST

Information technologies in the South/Southeast region of the country—defined in our survey as the region extending from Virginia to Texas—kept in synch with the national average. The region led in salaries for two positions—IS managers and programmers. However, the salaries for most IT staff positions lagged other regions of the country.

The picture for the major southern metropolitan areas covered in this survey—Atlanta, Miami, Dallas, and Houston—is mixed. While top-level management salaries in the two Texas cities were well above the national averages, staff IT positions lagged. Conversely, in the Eastern Seaboard cities of Atlanta and Miami, upper-management compensation lagged, while staff positions exceeded the national average.

MIDWEST

In this region, Chicago clearly leads as the corporate capital. The survey finds top executives in the Chicago metropolitan area garner an average of $128,200 annually in base salaries, leading the 12 areas covered in this survey. Middle management and staff positions also exceed the national average in this survey.

However, Chicago's high salaries do not extend beyond its far suburbs to the rest of the nation's heartland. Information technology salaries in the Midwest—defined in our survey as the region that extends from Ohio in the East to the Great Plains states in the west—lag those of other regions. While CIO/vice president salaries top all other regions at $138,600, most other positions rank lowest of the four regions covered. A lower cost of living, of course, may mitigate the impact on salaries.

WEST

The West—all states from the Rocky Mountains to the Pacific Ocean—is a strong contender with the Northeast in high salary levels. Two major areas drive much of these salary levels—southern California (anchored by Los Angeles) and the Bay Area (San Francisco, San Jose, and everything in between). For top-level IT executives, L.A. is the place to work, with average annual base salaries of $125,100, our survey finds.

The Bay Area still appears to be the place to be for many IT professionals. Upper managers bring in a $122,400 annual base salary, and middle managers are making $86,200—the second-highest level for all metro areas covered in the survey (cost of living notwithstanding). Bay Area salaries for developers/analysts and administrators also rank higher than the national average at $72,400 and $65,400 respectively.

HIGH-TECH PAYS TECHIES THE MOST

Overall, IT managers and professionals in the software and high-tech industries are commanding the highest annual base salaries in the survey. Table 3 provides salary breakouts by major industry group.

Software and high tech do not dominate in pay for top IT executives, however. For CIOs and vice presidents of IT, the highest rewards are found in the utility/transportation sector, where the average salary is $181,000. C-level executives in the retail/distribution sector follow at $158,500 a year, and healthcare CIOs make about $137,500. Software/high-tech does top the list for IT directors, however, with salaries averaging $108,900. IT directors at utility/transportation organizations follow closely at $106,800.

The software/high-tech sector competes with financial services/insurance for salary rates across most of the middle-management positions surveyed. Information systems and application development managers within financial organizations command the highest rates in the survey, earning $92,800 and $95,500 respectively. Data center, networking, and help-desk managers within software/high-tech make the most within their categories, at $85,300, $80,000, and $65,900. Among Internet managers, the highest draw is within service-sector organizations ($90,800), followed by healthcare organizations ($86,000) and retailers ($84,500).

Overall, software/high-tech organizations also compete for the highest salary rates for staff-level developers and administrators. Computer companies pay about $75,800 a year for systems analysts, along with $75,800 paid by service-sector companies. These IT companies are also locked in a virtual tie with financial services firms for programmer/analysts ($71,900 versus $72,700). Financial service firms pay the highest rates for systems programmers ($80,500), while retailers pay the highest premiums for basic programmers ($58,900).

Software/high-tech and financial services firms also are paying top dollar overall for administrator positions. DBAs at computer companies are averaging $78,300, followed closely by those with financial services firms at $77,800.

COMPANY SIZE MATTERS, BUT THERE ARE EXCEPTIONS

It comes as no surprise that larger companies pay better for many IT positions than smaller ones. However, the survey finds that IT salaries at the largest organizations participating in our survey are comparable to those of their mid-sized counterparts. For example, CIO and vice presidential-level salaries remain fairly competitive across all company sizes, with no clear pattern apparent from the survey results. Table 4 provides average salary figures sorted by company sizes.

For the next level of IT directors, however, the disparity between large and small organizations becomes evident. IT directors in the smallest firms (50 or fewer employees) make an average of $75,900 in annual base salary, a figure which tops $100,000 in employees with 1,000 or more employees, and reaches $118,200 in the largest organizations in the survey—companies with 50,000 or more employees.

Across middle management positions, the smallest firms in the survey pay between $52,800 and $76,600. This range increases to $63,400 to $108,200 within upper-echelon organizations. The disparity is greatest among networking managers, who are paid an average of $54,100 in the smallest firms. This is exactly half the salary level for networking managers in the large organizations surveyed.

The disparity for IT development staff positions is not as dramatic as that of IT managers. In fact, some developers in smaller companies make almost as much as their large-organization counterparts. For example, there is no discernible pattern for the influence of company size on systems programmer salaries. Systems analysts in larger organizations make between $76,200 and $83,100, which is roughly one-fifth to a third more than the average $63,100 in smaller to mid-size companies.

Administrative professionals in larger organizations clearly enjoy higher rates than their small to medium-size company counterparts. Database administrators average about $58,300 in the smallest companies surveyed, a level that rises to $82,000 in the large-organization categories—a 40 percent bump. Network administrators in some of the larger categories earn almost double their small-company counterparts—$68,600 versus $46,900 in annual base salaries.

TABLE 1: IT SALARIES BY REGION

Region
NE
SE
MW
W
CIO/VP
$135.2
$112.9
$138.6
$128.9
IS Dir.
101.1
92.4
90.5
95.7
 
IS Mgr.
84.1
84.5
74.2
81.7
App Dev Mgr.
89.9
87.3
84.1
91.5
Data Cntr Mgr.
85.5
77.5
77.7
77.2
Net. Mgr.
79.3
68.1
66.8
68.2
Help Dsk. Mgr.
63.3
60.9
56.7
62.2
Internet Mgr.
76.7
70.2
62.8
74.5
 
Sys. Analyst
76.6
67.7
73.2
70.4
P/A
68.5
64.1
61.6
66.6
Apps. Prog.
53.7
55.4
52.7
52.8
Sys. Prog.
75.9
68.0
76.6
70.0
 
Net. Admin.
63.8
56.1
53.1
58.2
Sys. Admin.
67.2
54.0
54.9
54.2
DB Admin.
77.8
70.8
68.7
71.3

Salaries in thousands of dollars ($ 000)


TABLE 2: IT SALARIES BY METROPOLITAN AREA

(Due to smaller sample sizes, job titles are aggregated intogeneral categories)

 
Upper mgt
Middle mgt
Developer
Administrator
 
 
 
 
 
New York NY/NJ/CT
124.0
80.7
74.0
79.5
Chicago IL/NW IN
128.2
78.6
70.3
64.8
Los Angeles/So. CA
125.1
81.1
69.5
63.2
Boston MA/RI
124.6
77.2
72.3
76.4
San Francisco/San Jose CA
122.4
86.2
72.4
65.4
Houston TX
118.4
73.3
52.4
55.1
Philadelphia PA/NJ/DE
116.2
78.6
70.0
50.9
Washington DC/MD/VA
113.8
88.0
70.4
70.8
Dallas TX
112.4
79.5
67.1
62.5
TOTAL U.S.
$106.6
$74.9
$64.5
$61.1
Atlanta GA
89.7
82.5
70.3
61.8
Miami FL
88.0
75.6
60.8
58.3
Seattle WA
87.5
66.8
60.5
60.0

Salaries in thousands of dollars ($ 000)


TABLE 3: IT SALARIES BY INDUSTRY

 
IT/High Tech
Mfg.
Gov't./Educ.
Finance/Ins.
CIO/VP
$122.1
$135.0
$102.8
$158.5
IT Dir.
108.9
91.7
82.3
101.3
 
IT Mgr.
90.9
78.1
73.3
92.8
App Dev Mgr.
94.2
83.2
78.5
95.5
Data Cntr Mgr.
85.3
72.8
71.8
85.1
Net. Mgr.
80.0
66.1
64.1
78.7
Help Dsk. Mgr.
65.9
63.6
59.1
60.9
 
Sys. Analyst
75.8
67.4
64.1
72.2
P/A
71.9
55.7
57.9
72.7
Progr.
54.4
52.4
47.8
56.3
Sys. Progr.
70.6
79.4
63.2
80.5
 
Net. Admin.
61.1
53.1
55.9
55.8
Sys. Admin.
61.4
52.8
54.7
57.5
DB Admin.
78.3
77.6
61.1
77.8
 
 
Retail/Dist.
Health
Uts//Trans.
Services
CIO/VP
$150.0
$137.5
$181.0
$122.7
IT Dir.
97.9
100.5
106.8
95.0
 
IT Mgr.
74.6
80.1
89.8
82.3
App Dev Mgr.
89.2
80.6
86.3
95.0
Data Cntr Mgr
69.0
83.0
85.6
75.1
Net. Mgr.
78.8
78.1
67.6
67.5
Help Dsk. Mgr.
56.2
65.0
59.5
49.9
 
Sys. Analyst
66.0
71.8
69.6
75.8
P/A
61.7
67.9
61.9
62.0
Progr.
58.9
58.0
49.7
48.9
Sys. Progr.
74.2
73.7
65.3
72.6
 
Net. Admin.
59.2
60.9
61.8
53.1
Sys. Admin.
50.5
61.8
57.5
60.1
DB Admin.
66.7
74.8
68.8
74.0

Salaries in thousands of dollars ($ 000)


TABLE 4: IT SALARIES BY COMPANY SIZE

75.9
59.8
number of employees:
1-50
51-500
501-1k
1-5k
5-10k
10-50k
50k+
 
CIO/VP
$112.6
$108.1
$139.2
$118.0
$204.4
$151.7
$130.6
IT Dir.
84.9
81.1
101.0
103.8
116.3
118.2
 
IT Mgr.
62.6
70.8
70.1
78.8
93.7
95.3
97.5
AD Mgr.
76.6
84.2
74.2
81.7
93.6
97.8
95.3
DC Mgr.
49.9
74.1
62.8
77.0
103.1
92.1
90.9
Net. Mgr.
54.1
63.3
55.8
75.2
78.3
108.2
94.4
H/Desk. Mgr.
52.8
53.3
48.8
67.0
70.9
63.4
66.2
Internet Mgr.
59.8
59.3
63.3
74.1
74.9
99.1
n/a
 
Sys. Analyst
63.1
63.5
63.9
68.5
69.0
83.0
76.2
P/A
60.5
58.2
63.0
62.2
68.3
71.0
Progr.
43.7
50.3
46.9
55.6
52.3
62.2
60.3
Sys. Progr.
79.9
58.5
49.2
71.6
67.0
76.3
75.8
 
Net. Admin.
46.9
56.0
53.1
58.9
68.6
63.5
64.4
Sys. Admin.
56.3
49.1
50.9
57.8
62.9
58.2
62.8
DB Admin.
58.3
64.5
67.6
73.8
82.5
75.4
81.2

Salaries in thousands of dollars ($ 000)


Complete IT Salary Survey:

Part 1: Salaries Stagnant for IT Staff
Part 2: IT Middle Managers Feel the Pain
Part 3: IT Follows Bicoastal Economy
Part 4: Complete Survey as PDF, including Section 4: Job Satisfaction; Short Registration Required

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