After the coronavirus outbreak, most countries implemented coronavirus-related restrictions to prevent the virus from spreading. As a result, organizations adopted working from home as a new way to move forward. Remote work has been beneficial not only for companies but for employees. It has increased workers’ satisfaction and has allowed companies to increase their productivity.
Due to the digital transition, more companies have invested in new technologies and are offering more remote positions. But, in the tech industry, working from home might be a threat to tech wages. If you want to know how this working trend is changing tech salaries, continue reading this article.
Before Covid-19
In the last few years, the tech industry has grown significantly. New technologies have become indispensable for companies to stay relevant. Because of the shortage of talent, organizations have provided outstanding salaries and perks. Before the Covid-19 outbreak, the average wage was $146,000 per year in the US.
According to Hired’s 2020 State of Salaries report, the San Francisco Bay Area reported a 7% increase with an average salary of $155,000 per year. Hired’s report also shows how salaries are skyrocketing in the healthcare sector. With an average salary of $87,000 in the UK and $151,000 in the US, healthcare tech professionals were the best paid in 2020.
While tech talent continues to become more valuable for companies, specific tech roles have reported significant salary growth. For example, in 2016, a software engineer’s average salary was $131,000 per year. But, in 2019, software engineers made, on average, $146,000 per year, according to Hired’s report. In other words, learning software engineering skills is an excellent alternative if you seek to change your way of life. Also, if you’re unemployed, it’s a great way to increase your chances of getting hired. After all, according to Computer Science Hero, there are over 19,200 job listings.
The Salary Gap
After the coronavirus outbreak, most companies needed to close their offices. As a result, remote work gained more popularity, and it’s proven to increase productivity. Although offering remote positions has been a great way for companies to diversify like never before, there’s still work to do. Hired’s report demonstrates how the lack of transparency in the workplace affects not only offered salaries but also employees’ expectations. For example, a Hispanic or Black data scientist would expect to receive a lower salary than a white or Asian professional with the same skills. In fact, Hired’s report shows that Black and Hispanic professionals’ preferred pay is, respectively, $9,000 and $4,000 less than the preferred salary of their white counterparts.
Employee Retention: a New Challenge for Employers
Tech professionals know they are now valuable for organizations. For that reason, their demands are higher. According to Hired’s report, tech professionals want the best of both worlds. They prefer a part-time remote job rather than working from home permanently. This situation has created a new challenge for employers, and providing schedule flexibility has become a must to retain top talent.
On the other hand, working from home means that most employees won’t be able to enjoy their in-office perks. As a result, some companies might consider providing added compensation equal to in-office benefits. Although this won’t become a reality for some, Hired’s report shows that over 50% of surveyed candidates would be willing to forgo added compensation if they get a full-time remote position.
Location-based Wages
Since remote work became a trend, most remote workers began to think about relocating. Remote work enables employees to do all their duties from anywhere. Hence, what would happen if you get a job in San Francisco and then move to a city like Denver? In short, if you keep your San Francisco salary, your net profits would be higher because of Denver’s costs of living.
That dream will only come true for some workers, but tech giants are already taking action to adjust salaries. Facebook, for example, is implementing location-based policies to adjust remote workers’ wages. In other words, those who think about relocating will experience a pay cut or a pay rise depending on their location.
Conclusion
The tech industry will continue to grow in 2021. Hence, more companies will embrace remote work and will start to offer more remote positions. Although tech salaries’ growth rate may decrease in 2021, wages in the tech industry will still be eye-catching. Given that, if you want to get a better job and have an excellent work-life balance, starting a tech career is a fantastic choice. It will help you to join the six-figure salary club and spend more time with your loved ones.