Not everybody in IT gets a bonus, but growing numbers of IT pros do, and those lucky folks will have a very nice chunk of change in their year-end pay stubs. Bonus payouts through the industry averaged $8,769 last year, and with IT unemployment at historically low levels, it's likely that bonuses will climb even higher this year.
Bonuses aren't handed out because employers want to be sure Bob Crathchit and Tiny Tim have a great Christmas; they're a tool to attract and keep the best workers. The unemployment rate for technology professionals dropped in the third quarter to 3.3 percent, versus 4.2 percent in the same quarter a year ago, according to the U.S. Bureau of Labor Statistics, and companies have been scrambling for talent for more than a year.
[ Look ahead at the IT titles getting the biggest pay raises in 2013. | The IT certs that no longer pay extra -- and the new skills that do. | InfoWorld uncovers the 10 highest-paying U.S. cities for IT jobs. | Get a digest of the key stories each day in the InfoWorld Daily newsletter. ]
Indeed, IT workers in the red-hot Silicon Valley job market already do better than the rest of the nation, with bonuses averaging just under $12,500, according to a survey by Dice, one of the largest IT-oriented job boards. Not only are bonuses in Silicon Valley larger than average, more people get them: 38 percent versus the national average of about 33 percent.
We won't know the actual size of year-end bonuses until early 2013, but employees surveyed by Dice are optimistic; 37 percent say they expect those payouts to be larger, and only 18 percent figure they'll shrink.
For bonuses, experience counts
The tech industry loves to think of itself as a meritocracy, but the Dice report casts a bit of doubt on that assumption, at least when it comes to bonuses. Time in the field is a key factor in determining who gets a bonus. "The key threshold appears to be six years of experience. After that milestone, more than 50 percent of tech professionals told us they are bonus-eligible," says Alice Hill, Dice's managing director.
Of course, another way to get a bonus can be to jump ship. Dice's survey shows that 16 percent of tech pros expecting a bigger bonus versus last year believe switching companies was primarily responsible for the hike.
IT hiring is strong -- for contractors, too
Hiring in IT has been remarkably strong, even as the rest of the economy struggles to keep unemployment under 8 percent. At the beginning of November, Dice listed 86,731 job postings in IT, compared to 81,680 a year ago. Listings for nearly every month of the last 12 months have been for 80,000 or more jobs. Those aren't all new positions; with tech unemployment so low, it's likely employers are taking a significant amount of time to fill vacant slots.
The Dice survey highlights another important tech employment trend: the growth of contract positions. Of the jobs listed this month, 52,870 are full-time, permanent positions, while 37,169 are contract jobs. More than 17,000 jobs were added in technology consulting during the third quarter of 2012. Through September, that category has had more than 56,000 new positions. "Ten straight quarters of job gains for technology consultants is no small feat. On-demand talent continues to be a dominant theme in this recovery," Hill says.