Developer jackpot: Salaries and bonuses hit all-time highs

As unemployment bottoms out, experienced developers reap the rewards, but Silicon Valley falls short in effective earnings

Bonuses are back -- if you're a software developer, that is. So are salaries. The job market for developers with the right skills is so tight that employers are offering bonus plans designed to attract new talent and keep their developers from moving to ever more lucrative positions.

As a result, salaries for developers in many parts of the country -- not just Silicon Valley -- are pushing into the $100,000 range and beyond.

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A new survey of 700 employers by, a major IT jobs board, showed that nearly two-thirds of those companies offered bonus plans for software developers and other employees. About one in 10 companies that offer bonuses have programs exclusively for developers, and nearly half of those programs have been put in place since early 2013.

The spike in bonus programs is no surprise given the high demand and tight supply in the market for software developers. Unemployment for developers was a low 2.3 percent in the first quarter of the year, according to the U.S. Bureau of Labor Statistics.

A search for jobs with "software developer" in the title or description yielded more than 12,000 hits on the job board. Simply put, it's a gold rush.

The hottest skills for developers
To join that developer gold rush, what specific development skills are managers looking for? According to Dice, here are the top five, in order of preference.

  1. Java/J2EE
  2. .Net
  3. C++
  4. C#
  5. SQL

That No. 1 need is for the very established Java, which should be a big help for developers who didn't just come out of school. "For a programming language that started to be commercialized about 20 years ago, its stranglehold on modern development is unshakable, including as a framework for the emerging Hadoop. And, of course, Java plays a part in Android (itself No. 31) and many other requests on the list," says Dice President Shravan Goli.

But the rest of the top five is also composed of established technologies that should mean experienced developers aren't at a disadvantage to the newly minted developers experienced with newer languages like Python.

Bonuses for some developers approach what executives get
How big are the bonuses overall? On average, they range from about 15 to 20 percent of the base salary, Goli tells InfoWorld. Highly productive developers with seven or eight years of experience are getting even larger bonuses, he adds. At the top of the range, some developers are being rewarded with bonuses of 30 percent, a payoff that in the past only went to executives.

Anecdotally, it appears that developers in skills related to big data, such as Hadoop, along with cyber security and mobile development, are being rewarded with the largest bonuses. Indeed, a very few top talents are getting packages worth as much as $2 million when equity is included, says Goli.

Salaries are highest in the (expensive) tech meccas
Of course, a bonus is only one component of a compensation package. Separate data from PayScale, which tracks compensation across the country, shows that base salaries are soaring. Median salaries for developers across 20 major metropolitan areas average $75,425 a year. Remember, that means that half of those salaries are greater.

Median salaries for software developers in Silicon Valley, of course, are the highest in the country at $97,000 year, according to PayScale. Because the Seattle area is home to tech giants like Microsoft and Amazon, it's not surprising that salaries there are a close second at $95,000 a year.

But if you're thinking of moving to one of these cities to make more money, there's a factor you need to consider. The cost of living in many areas is so high that your salary won't go nearly as far as you'd expect. For example, an $81,200 salary in New York City or northern New Jersey shrinks to $36,500 when PayScale adjusted for the cost of living.

After adjusting the salaries for the cost of living in their cities, here are the five metro areas where software developers will net the most money:

  1. Seattle: $80,800
  2. Phoenix: $77,600
  3. Atlanta: $76,100
  4. Dallas: $75,600
  5. Houston: $75,500

Notice that Silicon Valley, the emblem of the developer gold rush, didn't make the top five in effective earnings.

For developers anywhere, times are good. If you're not getting paid what you're worth, you have lots of better options.

This article, "Developer jackpot: Salaries and bonuses hit all-time highs," was originally published by Read more of Bill Snyder's Tech's Bottom Line blog and follow the latest business technology developments at For the latest business technology news, follow on Twitter.


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