IT skills bonus pay finally heading upward, study finds

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March 01, 2005 (Computerworld) -- After three years of declines in the bonuses paid to specially trained IT workers, skilled employees are likely to see bonus pay rebound this year, according to a new study by Foote Partners LLC, a New Canaan, Conn.-based IT research consultancy.
The Hot Technical Skills and Certifications Pay Index (download PDF), compiled quarterly by Foote Partners, was released Sunday. According to the survey of 46,000 U.S. and Canadian IT workers, the bonus pay for certain IT skills spiked late in 2004.
"At this time last year, the skills pay numbers were terrible," David Foote, president of Foote Partners, said in a statement. "There were overall annual declines of 6% to 8% -- and an even worse two-year drop of 11% to 23% -- respectively for the certified and noncertified tech skills tracked in our survey research. But one year later the pendulum has swung to the other side, with 1% to 4% increases in 2004."
A fourth-quarter growth spike at the end of 2004 will likely contribute to the trend in the first half of 2005 and probably thereafter, he said.
In an interview today, Foote said the results indicate that the tech downturn of the last few years is seeing signs of recovery, at least in terms of pay for workers with the skills needed by business.
"Frankly, we think it all comes down to skills," he said. "Pay is becoming an issue again. That's a pretty big headline because it means companies are investing in people again, not in outsourcing."
The study tracks salary premiums paid by employers for certain IT job skills, ranging from HP/Compaq Accredited Systems Engineers to Lotus Certified Associate Systems Administrators and Cisco Certified Network Associates. While the bonuses are sometimes paid separately from regular salaries, in recent years the extra money has often been included in base salaries, according to the study.
Overall median average bonus pay for 62 IT skills that require certifications grew by almost 4% in 2004, to 7.9% of base pay. The 11-page study said the improvement appears to be linked to companies' desire to retain skilled staff members amid increasing competition in the marketplace for such workers.
Bonuses were also on the upswing for IT workers who don't have certifications, according to the data, which is important because not all employers require or value formal certifications over actual on-the-job experience.
Uncertified IT workers with skills in messaging and groupware; networking and internetworking; and application development tools and software languages received higher increases. But employers put less emphasis on workers with database skills and Web and e-commerce skills, according to the report.
Foote Partners has been compiling its quarterly Hot Technical Skills and Certifications Pay Index studies for the past five years.

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