Programmers' Pay Way Up, but Confidence Down

While IT worker confidence fell last month, programmers had reason to celebrate -- their pay jumped 17.6 percent since October of 2004.
While IT worker confidence fell last month, programmers had reason to celebrate -- their pay jumped 17.6 percent since October of 2004.

A year ago, application developers were looking at a tough, if not frightening, job market. Their jobs were increasingly being shipped offshore to Indian, Russian and Chinese workers who would do the job for a fraction of the cost. And their pay was down 6.1 percent, according to David Foote, president and chief research officer for Foote Partners, a New Canaan, Conn.-based firm that tracks pay scales.

Today, those numbers are changing.

''These are monster numbers for software developers, but for those of us who closely track IT workforce developments, this doesnt come as a surprise,'' says Foote. He explains that IT executives are coming out of the Sarbanes-Oxley period, where their focus and budget was fed straight into dealing with major compliance issues. With that moving into the background, they, once again, can focus on new products and services.

And that will call for software developers.

It also means that not all of a company's software developers can be working 3,000 miles away.

''It's also about speed to market now,'' Foote tells Datamation. ''We need some predictability in how we deliver this to our customers. They've learned that offshoring is difficult and a lot of companies had schedules slip because of problems with hand-off. Companies more and more are saying, 'Now, we are going to in-source this if it's going to cost us just a little more. We don't want to slip our schedule and have one of our competitors beat us to market or beat us to the punch in some other way.' ''

Foote also says application developers are taking home bigger pay checks because companies are no longer looking for generic programmers. They want people with not only specific skills, but specific experiences. And narrowing in on job requirements, means creating a smaller pool of job applicants. Fewer applicants means companies will have to pay more to get the people they want.

''The more specific you get, the smaller and smaller the pool is of people you want to interview,'' says Foote. ''In the old days, they'd say they want five years of Oracle and some Web services experience. When you say you want that experience applied in the financial services industry, the smaller the pool of people who can fill that need. That's when it starts becoming a supply issue.''

Worker Confidence

Whether or not companies will continue hiring in the fourth quarter will have a direct effect on worker confidence, according to Steve Wolfe, executive vice president of Hudson, a Tampa, Fla.-based firm that tracks hiring and worker confidence issues.

And some uncertainty is causing a lot of volatility in the IT sector, Wolfe tells Datamation. ''We can see swings in how people view their overall job satisfaction and their personal finances,'' he says. ''It's interesting to see how it goes month to month. Every third month in the IT sector we see some pretty big fluctuation.''

In September, 82 percent of all workers rated their job confidence and satisfaction as 'excellent'. That number fell to 71 percent in October. Specifically in the IT sector, those numbers were 74 percent in September, falling to 71 percent in October.

''There's enough volatility that it's hard to say,'' says Wolfe, when asked to analyze IT's ups and downs. ''For November, we're looking to see some kind of spring back... Because organizations do have the tendency to slow down their hiring in the fourth quarter, that causes some people to raise an eyebrow. This is the time of year when people start to really do some gut checks, if you will.

''They ask themselves if they're in the right place at the right time,'' he adds. ''Is there a better opportunity for me. There might be more fourth quarter movement than there is in the second or third quarter.''






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