CIO survey: IT salaries in 2010 and how they vary by industry

As companies began emerging from the recession, IT salaries differed by industry, in some cases widely. How were industries alike? Raises and a generally upbeat outlook for 2011.

Last year, when IT budgets dipped, it paid to be a CIO in financial services. The average salary for CIOs and other

senior IT executives in the financial services industry rose 15.2% in 2010 to $152,437. That percentage change dwarfed the average 1.7% increase in pay, and outpaced the average $148,380 earned by the same group of IT leaders across all industries in 2010.

In health care, the picture was not so rosy. Top IT executives in this sector on average were paid 7.3% less in 2010, earning an average $142,686. That seems likely to improve in 2011: Health care's top IT executives said they are expecting a 5.5% pay hike this year. That increase will be on par with the 5.3% salary increase their counterparts across all industries anticipate -- and even a bit higher than the 4.4% raise pegged by their high-flying peers in financial services.

These findings are from TechTarget's annual CIO Salary and Careers Survey, taken in November. The 920 respondents represent more than 17 industries across the U.S., from retail to mining to education. Roughly half the companies represented are small and medium-sized (SMB) or midmarket businesses (100 to 999 employees), and half are enterprises (999 to 10,000 employees). More than half (56%) of the survey respondents identify themselves as director-level IT executives or above; the senior IT executive group (30%) includes chief technology officers and chief information security officers, as well as CIOs.

Senior executives' and managers' average 2010 IT salaries were flat, while those for IT leaders at the director level showed a 4.3% increase. These increases may represent actual raises or a change in the sample's demographics.

Of the four industries showcased in the tables that follow, the government sector on average paid its IT leaders the least across the three levels (senior executive, midlevel and managerial) surveyed. Salaries for senior IT executives in government rose an average 0.9% to $118,487 last year compared with 2009, well below the average salaries for their IT counterparts in health care, manufacturing and financial services. Pay for director-level IT leaders in government decreased an average 7.3% to $109, 278 in 2010 compared with 2009; and the salaries for IT managers slipped an average 3.9% to $91,331. (Because sorting the data so finely can result in low sample sizes, as shown, the findings for selected industries are anecdotal rather than statistically valid.)

 
Senior IT 2010
Increase From 2009
Expected Raise in 2011
Financial services
$152,437 15.2% 4.4%
Government
$118.487
0.9%
2.7%
Manufacturing
$148,765
2.5%
6.9%
Health care
$142,686
-7.3%
5.5%
 
Midlevel IT 2010
Increase From 2009
Expected Raise in 2011
Financial services
$132,333 0.4% 4.1%
Government
$109,278
-7.3%
2.3%
Manufacturing
$129,310
8.4%
3.1%
Health care
$117,969
5.1%
6.9%
 
IT Manager
Increase From 2009
Expected Raise in 2011
Financial services
$105,355 3.2% 4.9%
Government
$91,331
-3.9%
3.6%
Manufacturing
$94,530
5.4%
3.4%
Health care
$100,148
10.2%
3.5%

John Barker, IT director of the city of Nashua, N. H., which with about 90,000 residents is the second-largest city in the state, can attest to the less-than-optimal pay for government IT professionals. A five-year veteran in the job, his salary has been frozen for the past two years, at $94,000, he said.

"I'm embarrassed to say," Barker said, but he nonetheless regards the belt-tightening and prioritization forced on the city as a good thing for the community. His pay freeze comes amid a $7.5 million overhaul of Nashua's IT services and infrastructure, including its public school system, approved by the city after he was hired. During his tenure, he has driven down IT costs every year while improving customer satisfaction, he said. "It's the tradeoff for working in the public sector, which is where I want to be," he added, although he did not rule out moving on to a bigger municipality, where pay scales are higher.

Not all government CIOs responding to the survey were disappointed by their pay. James Buston, CIO of the city of Auburn, Ala., earned $141,000 in 2010, slightly less than the average CIO salary across all sectors but $20,000 more than the average salary of a senior IT executive in government.

Last year, Auburn economized by dropping the 3% cost-of-living raise for city employees, but it retained a 3% merit raise. Buston manages a central IT budget of $1 million and oversees another $1 million in IT spending by the city's individual departments. A 15-year city employee, his situation differs from that of many of his peers because he also is Auburn's assistant city manager, a role that lends considerable clout to the IT agenda. That fact doesn't stop his peers around the state from asking him to send his salary data to their mayors. In his experience, however, CIO salaries can be hard to predict or peg.

"Salaries for CIOs can vary so widely. It really depends on the size of the company to a large extent, and on how the CEO regards the role," Buston said.

A recession where IT is not the scapegoat

Our survey of IT salaries also asked about salary satisfaction and the mood at organizations. Taken together, the responses show that the majority of IT professionals are satisfied with their pay. The exception was among the rank and file; 43% of IT staff respondents said they were somewhat or not at all satisfied with their pay in 2010.

On the other hand, every level of IT professional expects pay raises this year, with the overall (57%) raise pegged at 4.3%. Top executive IT leaders in manufacturing and director-level IT leaders in health care expect the highest pay hike, pegged by both at 6.9%. Interestingly, midlevel IT directors in manufacturing expect the smallest raise in 2011 -- 3.1%.

The responses to our CIO salary survey corroborated what SearchCIO.com has been hearing from CIOs in various industries as their companies claw their way out of the worst recession since the 1930s: The IT profession was not hit nearly as hard as it was during the tech busts of the mid-1990s and those of 2000 to 2002, when many departments suffered major layoffs and the average tenure for CIOs hovered around 18 months.

Instead, organizations have leaned on IT for help in this recession, from automating their business processes to pick up the slack left by employee cutbacks, to delivering up-to-the minute business intelligence and predictive analytics that could give the business a competitive edge.

The upward trend in CIO tenure is another measure of the value companies assign to IT, said Jerry Luftman, distinguished professor and director of the information systems program at the Howe School of Technology Management at Stevens Institute of Technology in Hoboken, N.J. In 2010, CIO tenure climbed to 5.1 years, according to the annual CIO survey he conducts for the Society for Information Management. That's up from 3.6 years in 2006 and a far cry from the revolving doors of 15 years and 10 years ago.

As for the mood at organizations? Despite the budget decrease in 2010 and the hardships of the past three years, most IT leaders responding to the survey reflect the upbeat attitude of Barker and Buston: 72% of IT executives, 65% of IT directors and 61% of IT managers rate the atmosphere at their organizations as neutral or optimistic. When looked at by industry sector, entertainment (with a sample of size 22) is the only industry where the majority of respondents (64%) described their work place atmosphere as pessimistic.

Let us know what you think about the story; email Linda Tucci, Senior News Writer.

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