You: What you make

By LYNNE CASTRONUOVO and SUSAN ELLERIN
Network World, 7/26/99

Jonathan Weinberg is one happy network professional. His base salary jumped 9% from $110,000 to $120,000 this year. And by the time he collects an expected $30,000 in bonuses, his total 1999 compensation will hit $150,000, an 11% increase over salary plus bonuses last year.

Weinberg, 30, manages about 25 employees as director of technical services at Baseline Financial Services in New York. While the five-year veteran of the firm realizes it's an opportune time to job-hop, he enjoys his work and is happy staying right where he is.

His pay raise would be the envy of most U.S. workers, whose average weekly earnings rose a modest 3.2% over the past 12 months. But the IT job market is so hot that Weinberg's percentage increase is actually below that of many of his peers.

The 1999 Network World Salary Survey shows that total compensation rose an impressive 18% this year. Total pay jumped from an overall average of $63,050 in 1998 to almost $75,000 in 1999, according to respondents' estimates of the bonuses, stock options and additional pay they will amass before the year is out.

The survey focuses on salaries for senior network executives, LAN/WAN management, other network management and network staff. Senior executives' total compensation increased by 24%, LAN/WAN managers' by 9%, other network managers' by 10% and network staffs' by 16% (see chart).

Base salaries increased by almost 14% in 1999. Average salaries range from about $56,000 for network staff to more than $76,500 for senior network executives. A full 46% of respondents receive bonuses, stock options or other salary enhancements; only 40% earned these extra benefits last year.

Not only are more network professionals receiving additional sources of pay, but these monies account for greater proportions of overall compensation - 15% today compared to 12% in 1998 (see chart).

Big companies, big pay

We examined relative compensation levels in three types of companies - those with fewer than 1,000 employees, those with between 1,000 and 9,999, and those with 10,000 or more. Larger companies typically offer higher salaries (compare charts).

But in an increasingly tight labor market, it is perhaps not surprising to see smaller firms making a valiant effort to catch up by consistently giving higher-than-average salary increases than their larger counterparts. While fewer smaller firms distribute bonuses, those bonuses tend to account for a greater portion of employees' overall compensation.

Just as in 1998, regional salary differences are apparent, even when company size and titles are constants. On average, network professionals in the mid-Atlantic region command significantly higher salaries than their counterparts in other areas of the country (see chart).

Regardless of location, the IT labor shortage is obviously having an impact on job offers. Those who have worked for their employers for just a few years attract relatively higher salaries than those who have tenure.

"Companies are in a bind. On one hand, they can't afford to lose the people who really understand and run their systems. At the same time, they need to compete aggressively to attract the small pool of high-level IT managers," says Bruce Dorskind, president of Dorskind Associates, a strategic human resources consultancy in New York.

A gaping gender gap

The survey yielded a startling picture of the average compensation of female vs. male professionals. The typical woman earns about 72 cents for each dollar earned by the typical man - a disparity that is fairly constant across the four network job functions (see story). This large difference can be partially explained by the fact that fewer women have advanced degrees, and more work for smaller companies. However, even when we control for these variations, we find women's earning power to be much lower than that of men.

Despite their lower average pay, women are less likely to be actively looking for new employment than their male counterparts. We used STAT Resource's validated method for measuring employee loyalty to divide respondents into one of four groups depending on how likely they are to change jobs:

Seekers - Actively looking for a new position.
Explorers - Would follow up if they learned about an interesting job through an advertisement or another person.
Approachables - Would consider an opportunity only if they were personally contacted.
Loyalists - Cannot envision changing jobs in the near term.

Only 43% of the women are seekers or explorers. In contrast, 54% of the men are taking active steps to find new positions. More women report themselves to be merely approachable. About the same proportion of professionals of both sexes - approximately 13% - call themselves loyalists (see graphic).

These differences may reflect greater passivity on the part of women, or merely the fact that women are frequently juggling more responsibilities on the home front that would stand in the way of more active pursuit of other employment options.

Interestingly, compensation doesn't appear to drive loyalty because those who are open to new job opportunities are likely to be paid about the same as those who are not looking. Yet while compensation may not inspire workers to look for a better deal, it's clear that rich offers may cause people to jump ship when approached. For this reason, employers are focusing more on retention and ensuring that they offer competitive compensation packages and benefits.

Salary calculator
Are you getting as much as your peers? Find out with our calculator: Answer questions about your experience, company size and location and it'll use the data from our salary survey to tell you how much you should be making.

Shortchanged by sex
Full equality of the sexes? Not when it comes to IT salaries.

Salary links
Articles on advancing your career.

The data

Plentiful paychecks
Overall numbers

Compensation components What percentage of your overall earnings comes from salary, bonuses, etc.

Compensation numbers for:

Regional differences:

Misc:

Limited loyalty
More than half of you are looking for a new job; but men are more likely then women to do so.
Pay disparity
There's still a sizeable gap between men and women.
Eligible for extras
The larger your company, the more likely your base pay is to be supplemented with bonuses, stock options and the like.
Dividing up the dough
When a smaller company does supplement basic pay, that additional income generally accounts for a larger portion of overall compensation than it would at a larger company.
Benefits breakdown
A chart showing policies and programs offered by company size and the percentage of respondents who take advantage of those benefits.
High and low points
Profiles represent the highest paid and lowest paid IT staff members who participated in the 1999 Network World salary survey.

All the data
In an Excel 5.0 spreadsheet.

Past Network World salary surveys

Castronuovo is research manager and Ellerin is president of STAT Resources, a strategic research and consulting firm in Boston. STAT can be reached at www.stat-resources.com. Neal Weinberg, Network World features editor, also contributed to this story.

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