In-Depth

2005 Salary Survey, Part 1: IT Staff Positions

Salary growth remains spotty for it staff

• 08/16/2005

The IT job market has been strengthening over the past year, and hiring has picked up in many sectors. However, for IT line positions, the bumpy IT economy and continued pressure on IT budgets are still putting a damper on salaries. Among seven key IT staff positions covering applications and systems responsibilities, four have seen increases in average base salaries over the past year while three suffered downturns. The worst positions to suffer, and slowest to recover from the downturn earlier in the decade, are systems-related jobs. Application development and administration jobs, on the other hand, have seen raises in recent years.

These are the findings of a recent salary survey of 1,170 enterprise IT sites conducted by Enterprise Systems. The latest salary survey tracked salary figures for IT managers and professionals across a broad spectrum of organizations. Along with a range of management positions (to be covered in next week's salary report), our survey covered seven IT line positions, including applications systems analysts, programmer/analysts, application programmers, system programmers, network administrators, system administrators, and database administrators. All figures are reported in U.S. dollars.

A majority of respondents (78 percent) support Windows Server 2003, 2000, or NT systems within their companies, the same number as last year’s survey. Just over a quarter of the respondents (28 percent) report having mainframe systems, while 45 percent support at least one version of commercial Unix. Another 23 percent run a midrange-class system, mainly IBM iSeries. About 30 percent run Linux, up from 24 percent last year.

Respondents comes from a wide array of industries, including government/education (24 percent), high tech/software development (12 percent), finance/insurance (10 percent), manufacturing (10 percent), services (8 percent), utilities/transportation (8 percent), health care (5 percent), and retail (5 percent).

There are some bright spots driving many of the latest salary increases for developers and administrators, according to survey respondents. "We are giving good raises to our employees -- Microsoft certifications are drawing the best compensation," said one respondent, a manager with an IT development firm based in the Southeast. Another survey participant, a manager with a telecom development firm, speculates that "security is going to be a big boom in the next few years.” He also sees “larger-scale management of network services and capabilities for VoIP, video conferencing, and more" as a career and salary growth area for IT professionals.

Many organizations have been aggressively cost cutting, keeping their IT departments lean and mean. “In the past two years, the size of our IT staff has dropped from 150 to 95, leaving a user-to-staff ratio of 158-to-1,” lamented one respondent, a manager with a government agency based in the Midwest. “Salary increases for this year barely top at 1.5 percent. The most sought-after skill is the ability to do everything with nothing."

Overall, there is a cautious, spotty optimism about new and ongoing opportunities in IT that may translate into increased compensation. "The market is starting to heat up again,” said the IT executive with a southeastern-U.S. based government agency. “The highest demand is for Web developers with some mainframe knowledge to know how to link the two up."

SYSTEMS ANALYSTS

Application systems analysts working in mainframe and Unix shops earn the highest salaries for this position, the survey finds. Overall, however, systems analysts -- who typically work with corporate management, end-users, and clients to plan and design systems -- saw no growth in annual base salaries over the past year. Currently, these IT professionals earn about $67,900, down slightly from $70,900 in last year’s Enterprise Systems salary survey. This is also nearly three percent higher than average salaries in the first survey of this series, conducted in 2001.

While average annual bonuses for system analysts are the highest of the IT line positions measured in this survey, there has been a decrease in this area as well. Overall, system analysts are projected to earn bonuses of about $4,100 on top of their base salaries for this year. This is down by over two percent from last year, and still down more than four percent from the beginning of the decade.

The typical systems analyst in our survey has about nine years of industry experience. On average, seasoned system analysts with 10 or more years experience make up to 39 percent more than their less-experienced or entry-level counterparts. Systems analysts working with enterprise resource planning infrastructures fare best ($70,700). Salaries were strong at ERP sites across the positions covered in the survey, in fact. "Implementation of our new ERP is driving our salaries these days," remarks the IT manager with a Midwest-based retailer.

The survey finds that salaries at ERP sites are followed closely by business-to-business implementation sites ($69,700). Business-to-business sites led last year’s survey.

By operating system environment, systems analysts in Unix shops fare best, drawing an average salary of $69,100. However, this is only about two percent above the overall average. Those systems analysts working in Linux shops (distributed systems only) saw the lowest compensation, averaging just over $65,000 a year.

System analyst salaries are strongest within the services sector, averaging about $75,000, followed by retail/distribution and high-tech/software, both at $73,000.

PROGRAMMER/ANALYST

Application programmer/analysts -- who develop applications and environments -- saw some modest growth since last year’s survey, up more than two percent, from an average of $63,800 to $65,200. Longer term, P/As have seen their compensation climb by 13 percent since the beginning of the decade. P/As are projected to also earn bonuses of about $3,400 this year -- about the same as last year, but substantially higher than earlier in the decade.

The typical P/A in our survey has about six years experience in the field. Long-term salary growth prospects appear good for professionals remaining in these positions, the survey finds. P/As with 10 or more years experience make 26 percent more than their less-seasoned counterparts. An entry-level P/A can expect to make an average of $57,500 a year, a figure that climbs to almost $73,000 for those with ten or more years of experience.

P/As working in companies with e-business initiatives underway saw the highest premiums, the survey finds. Those with companies with business-to-consumer implementations earned average base salaries of $66,700, while employees at business-to-business sites make $66,100.

By development language environment, programmer/analysts in CICS shops fare best, drawing average salaries of $67,100, followed by those with C/C++ shops ($66,000).

P/A salaries are strongest within the health care sector, averaging $74,000 in annual base compensation. Those in the high-tech and software sectors followed with $70,800. P/As in the financial services sector follow at $68,500.

APPLICATIONS PROGRAMMER

This has been a good year for application programmers -- typically those who write and text code. Programmers saw the largest jump in salaries across the IT staff positions covered in the survey for the second year in a row, and now average about $56,500 -- a rise of 6.6 percent over last year’s survey. Average base salaries for this position have risen by almost 15 percent since the beginning of the decade.

Bonuses have been healthy for application programmers as well, the survey finds. Programmers are seeing bonuses averaging $2,665, up 11% over last year’s average. However, application programmers have yet to recapture the bonuses they were seeing at the beginning of the decade.

Since many programmer jobs tend to be entry-level, these salaries are the lowest in the survey, and long-term career and salary growth in this category is limited. Application programmers who have remained in these positions for ten years or more do make about 37 percent more than their entry-level counterparts. The typical programmer in our survey has about six years of industry experience.

Programmers in mainframe and Unix shops make the most, our survey finds, topping $59,000 a year in base salary. By development language environment, programmers in CICS and COBOL shops fare best, drawing average salaries of almost $62,000 for CICS-based development and $59,000 for COBOL.

Companies deploying and managing supply chain management and business-to-consumer systems had the most generous compensation for programmers, paying annual base salaries of about $61,000 and $60,000 respectively. ERP skills also commanded close to $60,000 in base compensation for application programmers. "Rates are staying down but opportunities are picking up,” commented one respondent, a manager with a southeastern U.S. IT service company. “ERP programmer skills are in high demand and somewhat low supply." Application programming salaries are strongest within the high-tech and manufacturing sectors, averaging about $67,000 and $61,000 respectively.

SYSTEMS PROGRAMMER

Systems programmers had the toughest year in terms of salary and bonuses. Overall, salaries for this category slipped from last year’s survey. Systems programmers -- workers supporting the corporate infrastructure and networks -- are earning base salaries of about $67,150, down almost five percent (from $70,400) since last year’s survey. Salaries for this position have remained relatively stagnant since this position was first covered in 2002.

Systems programmers are projected to earn bonuses of close to $2,665, lower than last year’s additional compensation. The typical systems programmer in our survey may see tremendous salary growth throughout his or her career, however. Salaries range between $49,000 at entry level to $77,000 for more than a decade's worth of experience.

Mainframe skills continue to be a hot area for systems programmers. Those working in mainframe locations earned an average of $71,100, outpacing their Unix counterparts by about $2,000. By development language environment, systems programmers in CICS and COBOL shops fare best, drawing average salaries of $72,100 and $70,200, respectively.

By application area, systems programmers in ERP shops received the highest base compensation, averaging $68,700 in annual base compensation. Those in business-to-business shops followed with $68,000. Systems programmer salaries are strongest within the retail/distribution sector, averaging $81,200 annually.

NETWORK ADMINISTRATOR

As more companies focus on interoperability between systems and shared services, demand for network administrators to tie all the components together is rising. Network administrators, who monitor and troubleshoot network usage, are earning base salaries of about $59,300 -- growing 3.5 percent in a year.

Annual average bonuses awarded to network administrators are becoming more generous as well, increasing by 25 percent just in the past year. However, bonuses have not bounced back to levels recorded in our first salary survey in 2001 -- the tail end of the dot-com boom.

Network administrator salaries are strongest within the high-tech/software and services sectors, averaging $65,900 and $66,400, respectively. By environment, our respondents reported that network administrators in mainframe shops fare best, drawing average salaries of $66,100. Unix network administrators follow at about 65 percent.

The typical network administrator in our survey has about eight years of industry experience, and seasoned network administrators are drawing salaries of up to $65,400.

SYSTEMS ADMINISTRATOR

After seeing a significant decline in salary levels in last year’s survey, systems administrators are finally bouncing back. These professionals, who deploy and maintain operating systems and servers, are earning base salaries of about $60,500 -- reflecting a rise of about eight percent since last year’s survey. This is the largest one-year increase of any IT staff or management position covered in our survey.

System administrators are seeing huge increases in their average annual bonuses as well. Across the board, system administrators are projected to earn bonuses of about $2,600, an appreciable increase over the average $1,800 bonus reported in last year’s survey.

By platform, systems administrators in Unix environments fared best, earning an average of $66,500. Mainframe systems administrators followed with salaries averaging almost $65,500. At the low end of the scale were systems administrators in Windows server environments (with no mainframes), earning an average of $58,000.

System administrator salaries are strongest within the services sector, averaging $70,000. Salaries also above average for system administrators in application areas such as supply chain management systems ($66,300) and business-to-business deployments ($66,200).

DATABASE ADMINISTRATOR

DBAs, who oversee building and usage of company databases, make more than most IT line positions, but our survey finds that they have seen a small decrease in salaries. They currently earn base salaries of about $70,500 -- a 1.3 percent decline since last year’s Enterprise Systems salary.

Premiums for in-demand database skills are paid to those who work with IMS and DB2 environments, the survey finds. Database administrator salaries are strongest within the utility/transportation/communication sector, averaging $78,200, or more than 10 percent above the industry average for DBAs. Across the board, DBAs are projected to also earn bonuses of about $3,750, slightly above last year’s average.

The typical DBA in our survey has about nine years of industry experience. Our results show a 30 percent differential based on experience. It appears there has been a boost for entry-level DBA salaries. In last year’s survey, DBAs with less than five years experience made $50,100 a year, a figure that is up to $60,600 this year. DBAs with at least 10 years of experience average $78,700, up slightly over last year.

Supporting business-to-consumer application deployments is also a hot area for DBAs, the survey finds, drawing up to $77,000 a year. DBAs at sites with supply chain management implementations averaged more than $76,000.

Note: N/A indicates not available -- the question was not asked in our 2001 survey.

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Part 2: We examine management-level salaries.