#2. Compensation
Technologists Will Command More in Compensation and Traditional Benefits
What You Need to Know
With tech salaries continuing to rise and competitive demand for talent showing no signs of slowing, employers will need to be prepared to spend more in 2022.
In the coming year, you’ll want to set a budget that enables you to attract and retain top tech talent (and allows you to move through the process more quickly). Can’t pay higher salaries? Explore offering benefits that technologists express interest in but aren’t currently receiving (training and education, stock programs and flexible schedule options) as a way of differentiating yourself from the competition and attracting talent that is looking for benefits beyond salary.
The COVID-19 pandemic forced many organizations across the country to suddenly embrace remote work. When the feared (and, in some cases, expected) productivity decrease did not materialize, questions arose about the future of the physical office.
Average technologist salaries in the U.S. increased 3.6 percent between 2019 and 2020, reaching $97,859, despite the economic impact of COVID-19, and continue to rise.
Despite those questions, it seems that the nation’s most prominent tech hubs are still the place to work if you want to earn a significant salary. According to the 2021 Dice Tech Salary Report, the average technologist salary in New York City rose 11.6 percent between 2019 and 2020, hitting $114,274; in Austin, salaries rose 9.7 percent during the same period, to $104,344.
Both cities enjoyed substantial tech company investment throughout 2020 and 2021, and local companies are clearly having to pay more in order to draw in top talent, even if the talent in question is working from home for at least a few months longer. Amazon, Meta (formerly Facebook), Google and Apple hired thousands of employees in New York City in 2020 to support East Coast operations; in Austin, 39 tech companies or venture-capital firms established a presence, including Tesla, which plans on building an expansive “Giga Texas” factory. Boston and Silicon Valley both enjoyed salary growth of 2.4 percent, suggesting their status as well-established tech hubs is alive and well. Boston tech salaries have reached an average of $111,069, while Silicon Valley’s average pay stands at $126,801, making it the highest-paying tech hub.
Austin, TX
Between the well-established tech scene in Austin and the emerging hubs in Houston and Dallas, Texas continues to jockey to become a premier tech state on the scale of California.
The Texas government’s aggressive pro-business stance, combined with the lack of a state income tax, explain why California-based tech companies are giving the Lone Star State a very serious look. Oracle, for example, recently announced that it would shift its headquarters from its longtime Silicon Valley home to Austin; and if a tech giant like that is willing to make a move, others may follow.
But compensation isn’t all technologists will be asking for. In the 2021 Dice Tech Salary Report, released earlier this year, we reported on the top benefits technologists currently have and the benefits they want. As to be expected, traditional benefits such as health insurance, paid vacation days and 401(k) matching/pension topped the list, but there were some significant gaps midway down the list in what technologists' desire and what they are receiving. There was a 23 percent gap for training and education and a 17 percent gap for stock programs, hinting at where employers could differentiate their offerings to attract and retain tech talent. There was also a 15 percent gap in flexible schedule options, which is another lesson learned in 2021 that we discuss in the “Flexibility in Work Structure” section.
We believe these are the gaps that industrious employers, and especially those who may not have the resources of larger competitors, can look to fill through new programs or adjustments to current initiatives, giving them an advantage in conversations with technologist talent.
