A report from New York City-based consulting company Bluewolf says IT salaries across the board will continue to rise in 2008, with application developers leading the pack with 7.6 percent salary growth. The increase brings application developers' salaries to between $112,500 from $80,250.
The research, culled from weekly meetings with CIOs nationwide and then fed through an internal trending application, also suggests the advancement of open source software is triggering an increasing need for specialized application developers. "There's been a huge wave of people embracing open source technologies," says Michael Kirven, co-founder and principal of Bluewolf. "The availability of those techs has far outstripped the people trained for them."
Kirven says the "easy" application development has already been outsourced, but higher-end, more complex application development proves difficult to complete overseas. "Building maps and the assembly line format stuff has gone over there," he says. "But with the complex jobs there's too much of a breakdown in communication."
The rise of open source software in application development puts developers with a specialization in those technologies in a position to ask for a 30 or 40 percent pay increase, Kirven says. "We've gotten more requests from our permanent placement division for open source developers in the last six months than in the last five or six years combined," he says. "It's not as easy as getting free software, someone has to get it up and running. LAMP is everywhere now -- these types of technologies no one heard of 18 months ago are all the sudden becoming a hot commodity."
In addition, major companies like Adobe and Sun Microsystems add credibility to open source solutions like the AIR platform and MySQL, respectively. "I think anytime a large organization embraces something new you see a huge increase," Kirven says. "All the sudden MySQL can now be validated as a part of a complex architecture."
All these factors in combination put a strain on hiring managers to offer alternative methods of compensation. Application development may top the list for IT salary increases, but database administrators, network security administrators and quality assurance analysts will also see salaries increase. Project managers' salaries are expected to increase 7.4 percent from 2007 to 2008, with an average starting salary between $85,000 and $150,000.
Not every company has the budget to meet the salary compensation required, Kirven says, which has led to inventive and forward-thinking ways to compensate prospective employees. "There's a couple of things going on -- people are definitely getting much more creative with compensation," he says. Concepts like flex time and the ability to work remotely are important concepts to people with young families.
In addition, people are now more than ever taking stock of the work environment. "We see a lot of these people interested in the culture of the organization," he says. "People care about where they go to 60 hours a week."
The most important trend Kirven says he sees is the demonstrated dedication of support and education for new hires. "We're seeing hiring managers very explicitly explain to candidates they will be provided with the correct training and support," he says. "They'll say, 'we want you to be the go-to person as we investigate open source opportunities in the market."
That kind of compensation can be more important to a developer than a signing bonus, Kirven suggests. "When you're a coder, you biggest asset is your ability to stay current," he says. "It can make someone who might normally go to Lehman Brothers go to a startup."