IT compensation satisfaction at an all-time low

A recent survey found IT compensation satisfaction has hit a record low, with relatively few IT workers saying they are satisfied with their pay. Industry observers, however, suggest the issue might not be entirely about money, leaving CIOs with options for boosting morale on thin budgets.

In its latest IT salary survey, tech careers site Dice found IT worker compensation satisfaction has recently plunged, “with only 41% of tech professionals reporting they were either ‘very’ or ‘somewhat’ satisfied with their compensation. This represents a significant decline from previous years.”

Dice identified several likely causes, including feeling underpaid compared to peers (59%), fewer annual salary increases, and the “rate of employers offering several key benefits (401K, health insurance, PTO, remote work, etc.) appears to be declining.”

Forrester principal analyst Fiona Mark sees various causes for those changes. 

“IT compensation expectations grew during the pandemic, and many organizations have scaled back their IT compensation levels as demand has fallen, and there is more talent available in the market,” Mark said. “With demand for certain skillsets, especially skillsets like software development, falling off significantly, there is overall increased malaise in the marketplace, with the recognition that what used to be seen as a skillset that would continuously be in demand is now under threat, with AI and low-code rapidly changing the outlook for these skills.”

Ryan Sutton, executive director of the technology practice at the Robert Half HR consulting firm, agreed. 

“We’re going through a leveling of the economy right now,” Sutton said, adding that during difficult business periods employees crave consistency and reliability. “There is a little bit of satisfaction and contentment with what is seen as a stable role.”

Industry observers also said that although money is a critical factor in how appreciated employees feel, unhappiness with one’s IT role is often a result of other factors, such as changing job descriptions and a general lack of job security.

“Compensation is not the only tool enterprises have to improve employee experience and satisfaction. Enterprises can make sure that their employees are focused on work that excites them and they can see the value of,” Forrester’s Mark said. “Provide ample opportunities for upskilling in line not just with the technology strategy, but also with employees’ career aspirations. Ensure that employees feel empowered and have autonomy over decisions which impact them, and of course manage work-life balance, demonstrating that organizations do not simply value the work outputs, but the employees themselves as unique individuals.”

Matt Kimball, VP and principal analyst for Moor Insights and Strategy, agreed that employee sentiment goes well beyond salary and bonuses.

“Any time there is this much disruption, uncertainty, there is this notion that ‘you can’t give me enough for this,’” Kimball said. “The IT professional sentiment involves happiness and well-being and feeling fulfilled.”

Some IT workers are uncomfortable with the massive changes IT roles are undergoing at present, something that has been accelerated by generative AI experiments and adoption.

IT talent “used to go run backups and do patching. That made them feel validated because they knew their skills and that made them feel good,” Kimball said, stressing that those tasks are being automated. That means that workers are focusing on new tasks and new skills, making them feel much less comfortable and at ease.

The answer to that is company-funded training, including certificates dealing with gen AI and cybersecurity and other valuable skills. “I am going to prepare you for skills you will need in the future. AI is the new norm within the enterprise,” he said.