2005 Salary Survey, Part 2: Salaries, Bonuses for IT Executives Rise Slowly

Compensation is up in almost all of the positions surveyed, but bonuses have been wavering.

IT managers, for the most part, received raises in their salaries over the past year, though in most cases, the increases were tepid. However, some surprising bright spots have emerged, including premiums for those leading in business-to-consumer e-business shops. Our latest salary survey finds that companies are providing the highest rewards to IT executives overseeing the ability to build and deploy customer-facing systems. In fact, executives leading business-to-consumer initiatives are seeing premiums up to 25 percent. Further, B2C leads all other applications categories across all the eight executive positions covered in the survey. Those overseeing mainframe sites also have the highest salary levels across the board.

These are among 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 staff and technical positions (covered in last week's report), 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. All figures are reported in U.S. dollars.

In addition, salaries for most positions tend to plateau in the second decade of experience, the survey finds. With the exception of C-level and executives and Internet managers, there's very little or no premium built into the base salaries of seasoned IT managers beyond two decades.

Notably, all management positions except one experienced moderate gains in salaries since the first Enterprise Systems salary survey was conducted at the beginning of the decade, in 2001 (2002 in the case of three positions). In addition, six of the eight management-level positions covered in this week's report gained ground since the previous survey, conducted in 2004.

"Salaries have been increased due to increases in our business _ s bottom line, _ said the IT executive with a Midwest-based utility. _ Director positions and project management positions are drawing the highest premiums."


CIO AND VICE PRESIDENT OF IT

For chief information officers or IT vice presidents, more compensation gains came from bonuses than from base salaries. CIOs and VPs, who plan the company's broad IT direction and make all final decisions, saw muted growth in their annual base salaries, up 3.5 percent. Currently, these IT executives earn about $134,600, compared to $130,000 in last year _ s Enterprise Systems salary survey. In 2001, the first year of the survey, CIOs made an average of $120,700.

Across the board, CIOs are projected to earn average bonuses of about $33,900 on top of their base salaries for this year. This is up by a third over last year _ s average bonus, and represents the percentage of salary (25 percent) for any of the IT management positions measured in this survey.

Seasoned CIOs with at least two decades' worth of experience make up to 23 percent more than their less-experienced counterparts (those with fewer than 10 years of experience). The typical CIO or IT vice president in our survey has about 15 years of industry experience. CIOs managing organizations with business-to-consumer systems fare best ($171,000), followed by those at companies with customer relationship management (CRM) deployments ($169,000).

By operating system environment, CIOs in mainframe-driven organizations fare best, drawing an average salary of $163,500 -- more than 40 percent above the industry average. Those managing organizations with Unix systems follow at about $152,000.

As was the case in last year _ s survey, CIO salaries are strongest within the utilities/transportation sector, averaging about $207,400. This is followed by financial services, where CIOs typically pull in about $154,000, and high-tech/software, $148,000.


CIO/VP SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$134,600 $130,000 $110,560 $120,700 +3.5%+11.5%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$33,900 $25,400 $19,700 $21,200 +33.5%+59.9%

By Experience Level
<10> 10-19 years 20+ years Differential
$115,100 $122,700 $141,400 +22.8%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$163,500 $135,700 $151,800 $112,800 $113,500


INFORMATION SYSTEMS DIRECTOR

While information systems directors saw an increase in base salaries over the past year, these executives are just only bouncing back to the rates seen five years ago, before the IT spending recession. IS directors who plan, direct, and control all day-to-day information systems functions and oversee entire departments saw average salaries grow by close to four percent since last year _ s survey, up from an average of $95,250 to $99,000. This just about matches salary rates reported in the 2001 survey.

As with the C-level executives above them, much of the compensation for IS directors comes from bonuses projected to average about $10,700 this year (about 11 percent of their base salary). Bonuses for this management position have leveled off from last year _ s survey, however.

The typical IS director in our survey has about 14 years' experience, and long-term salary growth slows in the second decade, when average salary is about $102,000. This is a phenomenon found across most IT management positions in our survey, which shows that many hit the top of their salary range by this time.

As with other management positions, IS directors leading organizations with business-to-consumer environments saw the highest premiums, earning average base salaries of $118,200.

IS director salaries are strongest within the computer industry itself, averaging $124,100 within this sector. IS directors within financial services and utility/transportation organizations followed with $121,000 and $120,000, respectively.


IS DIRECTOR SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$99,000 $95,250 $92,510 $99,100 +3.9%-0.1%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$10,700 $10,600 $7,000 $3,500+0.9%+205.7%

By Experience Level
<10> 10-19 years 20+ years Differential
$81,000 $102,300 $107,400 +32.6%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$117,900 $101,500 $108,900 $92,600 $97,200


INFORMATION SYSTEMS MANAGER

Information systems managers -- who plan and approve equipment and software purchases, and also plan, direct, and control all day-to-day information systems functions -- now make average base salaries of about $83,600. While this is a gain of only 3.1 percent from last year, it represents a reversal of the salary slide executives in this position suffered between 2002 and 2004. In fact, IS managers still do not make the $86,100 average attained in 2002.

While bonuses are not at pre-IT recession levels (2001), IS managers enjoyed a relatively healthy increase in this additional compensation over the past year, rising 11 percent to more than $6,800.

As IS managers reach their second decade of experience, their salary premium increases by almost 24 percent. The typical IS manager in our survey has about 13 years of industry experience.

IS managers in mainframe shops enjoy the largest salaries, our survey finds, topping $99,000 a year in base salary. Those executives oversee Unix environments average $91,400 a year, followed by midrange sites at $91,100.

As with the previous categories, companies deploying and managing business-to-consumer systems are receiving the most generous compensation, paying annual base salaries of $98,600. IS managers at supply chain management sites follow at $93,400 respectively. IS manager salaries are strongest within the high-tech/software sectors, averaging $108,000. Executives in the financial services sector followed with $101,000.


IS MANAGER SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$83,600 $81,100 $86,100 $78,600 +3.1%+6.4%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$6,830 $6,100 $6,100 $7,800 +11.7%-12.4%

By Experience Level
<10> 10-19 years 20+ years Differential
$72,800 $89,200 $89,600 +23.1%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$99,000 $91,100 $91,400 $76,400 $78,800


APPLICATION DEVELOPMENT MANAGERS

With all the hype and excitement around service-oriented architectures and Web services, these should be heady times for application development managers. But accelerated application development efforts may be tempered by increased outsourcing, as well as continuing tight IT budgets. AD manager salaries have effectively plateaued in recent years, and bonuses have slipped. AD managers -- who plan, direct, and control all day-to-day application development functions -- are earning base salaries of about $86,500, roughly a one percent dip from last year _ s survey.

AD managers are projected to earn bonuses of about $6,900, down slightly from last year.

The typical AD manager in our survey will see salary growth up to 24 percent throughout his or her career. Salaries range between $74,000 at entry level to $98,400 for more than two decades _ worth of experience.

AD manager salaries are strongest within the high-tech/software sector, averaging $102,000. Financial services followed (at $98,300), and AD managers in the services sector (at $93,000).

Those executives leading development efforts for business-to-consumer systems have the highest pay, averaging about $98,000. Those overseeing development within organization supporting supply chain management systems also receive larger-than-average salaries -- about $93,200.


APPLICATION DEVELOPMENT MANAGER SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$86,500 $87,500 $85,600 $79,500 -1.1%+8.8%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$6,920 $7,100 $6,160 $8,000 -2.5%-13.5%

By Experience Level
<10> 10-19 years 20+ years Differential
$74,300 $91,200 $98,400 +32.4%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$93,300 $90,500 $91,400 $81,900 $82,200


DATA CENTER/OPERATIONS MANAGER

Managers charged with overseeing day-to-day operations of data center environments saw relatively little movement in their salaries over the past few years. Data center/operations managers are earning base salaries of about $79,700 -- _ a rise of only a half percent over last year.

Data center managers also are receiving smaller average bonuses this year, slipping by more than 14 percent (to about $6,200).

The typical data center manager in our survey has about 15 years of industry experience, and seasoned data center managers are drawing salaries of up to $81,000. However, the survey finds that salary growth appears to level off after about 10 years of work, suggesting a degree of wage compression for this position.

Data center managers overseeing business-to-consumer sites had the highest salaries, averaging $92,000 in this year _ s survey. Those managing ERP installations averaged $87,300.

Data center manager salaries are strongest within the high-tech/software sector, averaging $97,500. Those in the financial services industry average $88,000, followed by $86,000 for data center managers in manufacturing firms.

By platform environment, our respondents reported that data center managers in mainframe shops fare best, drawing average salaries of $85,600, followed by those in charge of Unix sites ($84,100).


DATA CENTER/OPERATIONS MANAGER SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$79,700 $79,300 $77,800 N/A +0.5%+2.4%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$6,160 $7,200 $5,760 N/A -14.4%+6.9%

By Experience Level
<10> 10-19 years 20+ years Differential
$72,500 $82,500 $81,200 +12.0%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$85,600 $82,200 $84,100 $75,700 $75,500


NETWORKING MANAGER

After a post-recession slump in salary growth seen in last year _ s survey, networking managers saw robust growth in salary averages. These executives -- who oversee the operation of the computer network -- are earning base salaries of about $75,800, reflecting an increase of 7.5 percent over the past year.

Bonuses have held steady for networking managers, however. These executives are projected to earn bonuses of about $5,800, a two percent increase since last year.

Salaries range between $64,000 for newer networking managers to $85,000 for those with more than a decade of experience -- a 27 percent differential. However, average salaries fall off for managers at the job for two decades or longer, our survey finds.

Networking manager salaries are strongest within the services sector, averaging $88,000 a year. Those with financial services organizations follow at $85,000, and utility/transportation network managers average $84,000.

Salaries are also above average for networking managers in application areas such as B2C systems ($83,500), ERP ($82,100), and CRM ($82,000).


NETWORKING MANAGER SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$75,800 $70,500 $71,900 N/A +7.5%+5.4%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$5,800 $5,700 $3,940 N/A +1.8%+47.2td>

By Experience Level
<10> 10-19 years 20+ years Differential
$63,800 $85,100 $81,200 +27.3%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$70,200 $66,500 $68,000 $59,400 $60,100

HELP DESK/SUPPORT MANAGER

Help desk/support managers -- responsible for diagnosing, troubleshooting, and correcting end-user system access problems -- have seen a bump in average base salaries. These managers currently earn about $63,000 -- up almost five percent over last year _ s Enterprise Systems survey.

Help-desk managers also receive appreciable bonuses for their work -- more than $4,000 projected for this year, which amounts to a 25 percent raise over 2004 bonuses.

E-business sites drive the highest premiums for help-desk management talent. Help desk manager salaries are strongest within companies running B2C systems, averaging $72,200, or about 15 percent above the industry average. Salaries run about $69,300 within business-to-business systems, and $69,000 at ERP sites.

The typical help desk manager in our survey has about 16 years of industry experience, and salary growth tops out after about 10 years.


HELP DESK/SUPPORT SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$62,700 $59,800 $62,600 N/A +4.8%+0.2%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$1,140 $3,300 $2,940 N/A +25.5%+40.8%

By Experience Level
<10> 10-19 years 20+ years Differential
$53,400 $74,100 $69,000 +27.1%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$70,200 $66,500 $68,000 $59,400 $60,100


INTERNET MANAGER/DIRECTOR

Internet managers and directors, who are responsible for development and management of company intranet and public Web sites, are seeing their salaries rise. They currently earn base salaries of about $83,300 -- reflecting a 17 percent increase over last year _ s survey, and 28 percent above the $65,200 they were earning at the tail end of the go-go dot-com era.

Employers have not been quite as generous with bonuses awarded to these executives, however. This year _ s average bonus will total about $4,900, down a hair from last year -- and still way under the levels seen in 2001.

Nevertheless, long-term salary-growth potential remains excellent for these positions. Internet managers with upwards of 20 years of IT experience can command average income of more than $140,000, comparable to the base salary of the average CIO.

Not surprisingly, top premiums are paid to those Internet managers who support B2C environments, the survey finds. Salaries average $102,200 at these sites. By industry sector, salaries are strongest within the service sector, averaging $133,300, or about 60 percent above the industry average.

The typical Internet director in our survey has about nine years of industry experience, and salary growth prospects are excellent for this profession. Our results show an astounding 98 percent differential based on experience -- from $71,700 a year to start to $141,900 for those with up to two decades of industry experience.


INTERNET MANAGER/DIRECTOR SALARIES

Year-to-Year Change
2005 2004 2002 2001 1-year changeChange 01-05
$83,300 $71,000 $78,400 $65,200 +17.3%+27.8%

Average Annual Bonus
2005 2004 2002 2001 1-year changeChange 01-05
$4,890 $5,000 $6,110 $6,500 -2.2%-24.8%

By Experience Level
<10> 10-19 years 20+ years Differential
$71,700 $88,500 $141,900 +97.9%

By Operating System Environment
Mainframe Midrange AIX/Unix Windows Non-Mainframe
Linux
$87,700 $83,600 $84,300 $71,500 $70,200


Next week: Salaries by region