Jobs ads reveal lowest pay rise ever recorded

According to the latest Computer Weekly/SSP quarterly survey of job advertisements, pay rates have plummeted unless you are a...

According to the latest Computer Weekly/SSP quarterly survey of job advertisements, pay rates have plummeted unless you are a senior SAP developer. Nicholas Enticknap reports

While firefighters went on strike for a 40% pay increase, IT staff changing jobs can expect next to nothing. Salaries offered to applicants for IT job positions have remained virtually static over the past year. The average annual rise across all job positions advertised in the third quarter was just 1.0%, according to the Computer Weekly/SSP Survey of Appointments Data and Trends for July to September. This is the lowest rise ever recorded.

A year ago advertised salaries had risen 2.9%, while at the peak of the Year 2000 compliance boom four years ago the annual increase reached 6.9%. The third quarter's 1% rise was well below the headline rate of inflation for September of 1.7%.

The increase in salaries advertised is not the same as the rise IT professionals in post actually get, but there has historically been a close correlation between the two. There is certainly little prospect of anybody materially improving their position by changing job at present.

Of the 65 job titles tabulated by the SSP survey, 23 actually had an advertised average salary less than at this time last year. Comms managers and database administrators saw the salaries on offer fall 1%; programming managers, business analysts, training officers and Web designers were offered 2% less; and operations managers and systems programmers suffered to the tune of 4%. Salaries offered to trainee developers were down 6% and to comms engineers down a massive 9% (from £32,000 to £29,000).

Harvey Nash group marketing director Paul Smith says that even at the top end salaries have stabilised in 2002. "In London in particular, the salaries have either stayed the same or gone down." He has found that the average salary paid to London-based IT directors has declined from £82,500 in 2001 to £77,000 in 2002.

The proportion of people satisfied with their salary has risen at the same time, from 30% a year ago to 39% now, according to Harvey Nash. "I would not have believed people were expecting lower salaries, bonuses and share options," says Smith. "All the dynamics are changing in the market."

Triangle Partnership managing director Cathy Walsh agrees, "Salary is an incidental now. You don't see people moving to try to improve the package. People will change for the same salary: they all move for the opportunity."

Smith believes some types of staff are suffering less. "Project managers and senior developers are still in demand, and there rates have stabilised. I don't think it will go down any further at the high end, though it will at the bottom end," he says.

The SSP figures support Smith's finding. Salaries offered to senior developers were up 5% and to other developers 2%. Systems analysis salaries rose 3% for senior staff and 2% for others.

The low level of salary increase generally is a reflection of the severely depressed state of the overall market. The total jobs on offer on the Web were down by two-thirds on a year ago; the jobs advertised in magazines were down by over 70%. The totals of jobs advertised in both places are the lowest ever recorded.

So demand at present is minimal - in general. But there still are opportunities for those with the right skills.

One skill currently commanding good money is SAP enterprise resource management. There was double the demand for professionals with expertise in SAP of a year ago, lifting this skill to 12th place in the league table. This upsurge is reflected in the salaries offered to mainstream development staff.

Systems developers with SAP skills are being offered 12% more than a year ago, from £38,000 to over £42,500. Senior developers did better still, with a rise of 17% from £47,500 to well over £55,000. That compares with the average salary rises for all developers of 2% and 5% respectively.

For other types of professional the inducement to acquire SAP skills is even more compelling. Analyst/ programmers with SAP expertise are 38% better off than a year ago, with the salaries offered up from £24,000 to nearly £33,000. SAP programmers have done nearly as well, with wages rising 33% from £22,000 to £29,000.

For systems consultants, the picture is different. Here the salaries offered to SAP specialists has fallen by 9%, from £78,700 to £70,400. That is exactly the same as the average salary decline for all consultants.

The reason for this is that the boom in SAP consultancy which was a feature of the Year 2000 compliance period is now over. IT sites are not looking for radical change involving expensive outside assistance; they are looking to consolidate the changes made during that period.

"It's all about making do and mending. People are not buying new software or new platforms. They are integrating, modifying and improving applications," Smith says.

One area where there is evidence of forward movement is in new wave Microsoft-based development. Interest in .net expertise is almost double a year ago, and this skill has jumped 68 places in the quarterly league table to 25th. The programming language, C#, has moved up 87 places over the year and is now 47th.

Microsoft's ASP Web server scripting technology is also looking good. Demand was down, but only by 29%, much less than the average, and as a result it has risen 11 places in the table to 15th.

All of this is in stark contrast to familiar Web-based skills such as Java, which we can now regard as legacy. Demand for Java fell by more than the market average, some 70%, though it has only moved down one place in the table. HTML is down 73% and Javascript down 72%.

Internet-based comms skills are falling from favour even faster. Demand for TCP/IP expertise fell 84%, and for Cisco 79%, and both skills are plummeting down the league table. This is partly because the comms industry sector has been hit even worse than the IT sector overall. Comms companies cut recruitment by more than any other sector last quarter.

The public sector, the one bright star for IT professionals of the past two years, had a quiet third quarter with a 38% fall in jobs advertised on the Web. Government advertising in the magazines was down by a little less, just over a third.

This sector is still a frenetic hive of activity compared to most of the others. Walsh says these organisations are actively looking to recruit from the business world. "There is a positive move to say we'd like people who could bring some depth into our organisation," she says.

Otherwise, it was the manufacturing companies which showed up best. Electronics companies and non-IT manufacturing and engineering firms all cut their IT recruitment by less than 40%. This was the sixth quarter in succession that electronics companies have done better than the market average, and they now account for 3% of all IT jobs advertised, up from 1% in April 2001.

Demand for Unix fell by nearly three-quarters from a year ago, but it remains the most popular operating system, just ahead of Windows NT. Windows 2000 has entered the top 20 for the first time. Windows XP does not feature in the top 150 skills.

Fall in the number of job ads by industry sector on the Web in the third quarter of 2002
Engineering: -35%
Manufacturing: -37%
Public sector: -38%
Electronics companies: -39%
Utilities/energy: -60%
Banking/finance: -66%
Distribution/retail: -67%
Software houses: -68%
Media/publishing: -70%
Comms companies: -73%
All jobs: -67%

Fall in the number of job ads by region
West & Wales: -56%
Scotland & Northern Ireland: -58%
Inner London: -65%
North East: -67%
Southern England: -67%
East Midlands: -71%
North West: -71%
Outer London: -72%
West Midlands: -76%
All jobs -67%

This article is based on information contained in the Computer Weekly/SSP Quarterly Survey of Appointments Data and Trends. The survey analyses advertisements for computer professionals on the Web and in the trade press and the quality national dailies and Sundays. It is primarily intended for recruitment agencies and IT managers with a substantial recruitment requirement.

The posts advertised are broken down in the survey into 65 job categories. Within each job category, the survey provides details of the number of posts advertised and the average and median national salaries offered for the last quarter and for each of the previous four.

The survey provides further analyses within each job category by platform type, industry sector and regional location. It also provides a breakdown for the major job categories of the technical skills most in demand. In each analysis, it again details the average salary on offer for each of the past five quarters.

The price of a single issue of the survey is £250, and for an annual subscription is £350. This covers four issues, and includes a free copy of a Windows-based software product which allows selection of combinations of region, industry and software skills for a specified job type. For further information contact Bernardine Caine on 01488-72705, or at bernardine.caine@rbi.co.uk.
This was last published in December 2002

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