Firms under pressure to increase salaries as IT jobs market recovers

Companies are under growing pressure to increase wages in order to recruit and retain IT staff, according to new research.

Companies are under growing pressure to increase wages in order to recruit and retain IT staff, according to new research.

Half of UKemployers are looking to recruit more staff over the next few months, according to a quarterly survey of recruitment trends published next month by the Chartered Institute of Personnel and Development (CIPD).

The CIPD, which surveyed more than 950 human resources managers, also predicted that inflation was likely in IT salaries.

The findings echo those of the Computer Weekly/SSL Quarterly Survey of Appointments Data and Trends, published earlier this year, which showed a continued recovery in the IT jobs market.

"Firms will have to be careful to retain the skills they have as there could be a shortage of people as the market steadily improves," said Paul Smith, director at recruitment agency Harvey Nash.

Smith added that companies must take account of the fact that some staff have not had meaningful pay increases for up to three years. For organisations where extra money is not an immediate option, changing benefits packages to offer training and perks might help retain skilled workers, he said.

But for those staff looking to cash-in on the more buoyant jobs market, what are the most effective methods to secure a pay rise?

The annual employee appraisal has become an important part of pay negotiations, according to Rebecca Clake, adviser at the CIPD. "This is often the best way of making sure your performance is properly evaluated for both immediate and future discretionary pay rises," she said.

Staff looking to make sure they get a fair rise the following year should use the appraisal system to establish clear business and personal objectives, and to get credit for what they are doing, Clake added.

When looking back at the previous year, staff in appraisal meetings should be prepared to demonstrate tangible results, including quantifiable sales figures or savings and efficiencies to the business as well as new achievements over and above targets set in the previous appraisal.

Clake acknowledged that appraisals are not done well in every company, with some of the people employed to manage the appraisal process failing to do so effectively.

Poorly-trained middle managers are sometimes to blame, said Clake. They can fail to deliver fair and appropriate appraisal meetings that encourage open and honest conversations - although IT as an industry does not have any greater problem with this than other sectors, she said.

Because appraisals are now seen as the key area of performance management linked to pay, it should not come as a surprise when newly introduced and contested appraisal systems lead to disputes between companies and their staff.

Outside the appraisal system, there are other areas staff need to take account of when evaluating their pay possibilities, said Clake. Employees taking on extra responsibility for no extra pay will have more bargaining power during salary negotiations. Profit-related pay is also becoming more common.

Read more on IT jobs and recruitment