Pay hikes may not be as high as in the recent past, but network executives still are garnering healthy increases in overall compensation despite a generally stagnant economy.

Education pays Maintaining job satisfaction Too many hours Chart: How much are you earning? Chart: Education vs. certifications Your loyalty 2000-2002 Loyalty by title Chart: Your criteria for job satisfaction Chart: Your work hours A salary pickle in California Defining the gender gap Salary calculator Chart: Salary survey demographics

That about sums up the IT salary picture over the past year, according to the 2002 Network World Salary Survey, conducted with the help of King, Brown & Partners. Network executives - those with manager or director titles - reported a 4.4% increase from last year for an average base salary in 2002 of $70,450 (see chart). Across all job titles, from CIO to staff, the 1,678 survey respondents reported an average increase of 4.7%, for a base salary of more than $71,500 in 2002. While most respondents expect only modest hikes, if any, in bonuses and stock options, when factoring those in, network executives expect to see a 4.7% increase in total compensation over 2001, to $75,460. Respondents at large organizations anticipate a 5.3% hike in total compensation to more than $78,000.

But network professionals will have to work for that money, upwards of 60 hours per week, with those in the upper salary brackets shouldering the heaviest schedule (see chart).

True, these increases are down from the heady days of 7% overall hikes reported in each of the past two annual surveys - and the 11% hike for network executives last year. Still, network professionals are faring far better than their counterparts in other white-collar jobs. For the year 2000, the most recent for which data is available, the Bureau of Labor Statistics (BLS) reports white collar pay averaged $19.35 per hour, or $40,248 per year based on a 40-hour week. Even correcting for the age of the data, it's clear that the network industry still outpaces most others. And network professionals are beating inflation soundly, as the BLS Consumer Price Index was up only 2.8% for 2001.

That holds true across the board, from the staff-level professionals whose average base salary increase was 4.5% (to $63,180), to those at the top of the IT totem pole, who got salary hikes averaging 4.9% (to $108,820). Indeed, those at the CIO and senior vice president levels also enjoyed bonuses that were four times greater than their manager/director counterparts along with nearly 16 times more income from stock and stock options.

The increases reported in this year's survey "are more than I anticipated," says Edmund Hung, network director for Guitar Center, a 4,000-employee retailer based in Westlake Village, Calif. Like many survey participants, Hung braced for a period of slow growth since the Sept. 11 terrorist attacks, because of the nature of Guitar Center's business. "We're in the business of joy and happiness, helping people make music," he says. His company prepared for hard times by scaling back performance bonuses from the norm of 15% to 12%.

Hung's own salary increase, at about 5%, was better than the 4.4% of his colleagues in the management/director category. That's doubly significant given that with his base salary of $110,000, he already does much better than his peer group.

Location accounts for some of that difference. As is the norm, base salaries for all respondents in the Pacific region outpaced all others except New England, with overall averages of $76,720 (more than 7% higher than the nationwide average) and $78,980 (more than 10% higher), respectively. The effect of a new California law on computer professional pay is likely bumping up those Pacific figures (see story). States in the Southern Midwest and Northwest pay the least, with base salaries for both regions averaging around $62,500.

Company size is another factor. Interestingly, companies with fewer than 100 employees pay best - nearly $85,000 in total compensation - while companies in the 100- to 999-employee range pay least, an average of just more than $70,000. Companies with 1,000 or more employees pay an average of at least $80,000.

If it's a sizeable bonus you're after, you'll most likely get it by taking a job with a company that has fewer than 100 employees, too. Respondents from such firms expect bonuses of nearly $8,000 this year, up more than 22% compared with the $6,500 they got in 2001. Companies in the 1,000- to 9,999-employee range are stingiest with bonus dollars, at about $3,600, while those above 10,000 employees are expected to pay an average of nearly $5,000 in bonuses for 2002.

 In fact, bonuses of as much as 15% of salary are fairly common for smaller companies, says Jeremy Schulman, a senior recruiter who specializes in placing IT workers for the Lucas Group in Atlanta. The industry norm, particularly for larger companies, is the 8% to 10% range, he says.

Still, bonuses have stagnated during the past few years. In last year's survey, respondents reported receiving bonuses of $4,400 on average in 2000. This year's respondents said they got $3,830 last year and expect an average of $4,330 in 2002.

As for stock and stock options, most respondents are getting amounts so small as to have little effect on their overall compensation package. The average stock-related compensation all respondents received last year was just more than $1,000, and they expect an average of about $1,200 this year. Those figures represent a steep downward spiral, from an average of more than $5,000 in 1999 to $2,000 in 2000. An exception to the rule, as might be expected, is for titles falling under the senior IT category, such as CIO and vice presidents. Such respondents expect an average of more than $9,300 in stock-related compensation in 2002, an increase of more than 8% from the average of $8,670 last year.

Education pays

If you want to earn the really big money, then follow this simple formula: Stay in school. This year's survey showed a direct correlation between level of education and salary (see chart). Those with a bachelor's degree earn $7,000 more on average than employees with only an associate's degree, while employees with graduate degrees earn an average of nearly $14,000 more than their counterparts with bachelor's degrees.

Certifications appear to be a poor substitute for more formal education. Indeed, survey data shows no discernable pattern in terms of pay and certifications. Those with no certifications make more than those with one, while employees with two or more certifications make less than those with just one. In general, respondents seem to try to compensate for less formal education by picking up more certifications. At least 50% of those with only high school or associate degrees have at least one certification while only 45% of those with bachelor's degrees and 35% of those with graduate degrees have at least one certification.

But some people aren't impressed by any amount of education.

"I could give a darn about a degree," says Jon Wright, vice president and Internet engineering manager at SunTrust Banks in Richmond, Va. Wright, who has nine engineers reporting to him, says he looks more for real-world experience and notes he's seen students just out of high school who had what it takes and those with master's degrees who couldn't find their way around a router.

Yet Schulman, "absolutely, 100%" agrees that formal education will get you paid more than certifications. "It's because all the dot-coms are gone now," he says. Previously, dot-com companies snapped up workers who held Microsoft, Cisco or Oracle certifications and could do some form of development work. Now, more established companies prefer employees with a solid educational background. "Generally, it shows more of a stable background if a person has a degree," he says.

Your loyalty 2000-2002 Hard economic times have slightly more employees inclined to stay put than last year and even fewer job seekers than in the employee-shortage heyday of 2000.   Seekers: Actively seeking a new position.   Explorers: Not actively seeking, but would follow up if they read or heard about an interesting opportunity.   Approachables: Not actively seeking, but would follow up if personally approached with an interesting opportunity.   Loyalists: Cannot envision changing jobs in the foreseeable future.

Maintaining job satisfaction

One of the ways employees traditionally receive education and training is to have their employers pay for it. In fact, lack of professional development and training is one of the leading reasons employees jump ship, respondents told us when ranking factors that would cause them to seek a new job. Training rated a 3.0 out of a possible 4. Notably, too, in this post dot-com era, job security has moved into the top five factors this year, ranking a 3.1 (see chart).

Kendall Norling, manager of IS for Finagle A Bagel, a regional restaurant chain based in South Boston, Mass., says job security is the most important factor to him. "In this day and age, you've got to think of that," he says. "I've watched my friends go into dot-coms and get chewed up and spit out," he says. He's confident the 20-year-old, privately held Finagle A Bagel is well-financed and has a good future, having almost doubled in size in the three years Norling has served as its one-man IS department.

Norling maps nearly perfectly to other survey respondents in saying that other important job satisfaction factors for him are overall compensation, benefits and the challenge of the job. As for his salary, he could make the case that he deserves a raise, given that the average 2002 base salary for IT staff personnel in this year's survey is $59,450, a bit higher than what Norling makes for a more senior position.

Too many hours

Overall, network professionals are not actively job hunting more this year than last, although they are hunting far less than they were in the employee-shortage days of 2000 (see chart). This, in turn, has lead to a change of heart on other aspects of job satisfaction. In years past, job flexibility was often cited as important, for instance. This year it rated about in the middle of the pack, averaging 2.7 out of a possible 4 in terms of how critical it would be in a decision to take a new job. But those who value their flexible schedules are sometimes willing to forgo a lot to get them.

Who will leave the company first, you or your staff? Those in staff positions are slightly more likely to be feeling out new jobs prospects than are network executives, those with manager/director titles.   Seekers: Actively seeking a new position.   Explorers: Not actively seeking, but would follow up if they read or heard about an interesting opportunity.   Approachables: Not actively seeking, but would follow up if personally approached with an interesting opportunity.   Loyalists: Cannot envision changing jobs in the foreseeable future.

Take Carlos Behr, an IS technician for the California Department of Food and Agriculture (CDFA) in Sacramento. He's one of two IT staffers in a branch with 40 employees, handling chores ranging from publishing Web pages to database administration and help desk.

"I have taken less [money] to have a flexible schedule," the four-year CDFA veteran says. "I have a munchkin at home and taking care of him, doing the whole Little League thing, it makes a big difference in life." Enough so that Behr is content making $32,400 annually, far less than his market value, according to our survey.

But then again Behr also doesn't feel compelled to put in the kind of hours that many of his peers at other organizations do. The average hours worked per week, including time spent working at home and on call, is more than 63.5 (see chart).

"That's not me, not at my pay rate," Behr says. "I'm doing about 40."

SunTrust's Wright is closer to the average, as he estimates he works between 50 and 60 hours per week. "I've got two young children. It gets rough," he says. "But I've got people who are putting in 80 or 90 hours per week," the result of being shorthanded and having too many high-priority projects to tackle.

Statistically speaking, women put in significantly fewer hours per week compared with their male counterparts, an average of 56.9 hours per week vs. 63.8. That was just one of a number of differences the survey turned up between the genders (see story).

If you think you're working too much for too little pay, Guitar Center's Hung has some words of encouragement. "I've always firmly believed that if you can accept the challenge and do the work accordingly, somebody somewhere somehow will see your work and you'll be handsomely compensated," he says. As for himself, "I consider myself well-paid and stable, so I don't shoot for the moon."

Desmond is a freelance writer and editor in Framingham, Mass. He can be reached at paul@pdedit.com.

Network World's Career Advisor newsletter
News, tips and advice that help you make the most of your skills.

The 2001 Network World Salary Survey
Take an in-depth look at the difference between last year and 2002.
Network World You Issue, 07/23/01.

IT training rip-offs
Some shoddy IT schools squander students' time and money. Learn how to safeguard your education investment.
Network World, 03/25/02

Apply for your free subscription to Network World. Click here. Or get Network World delivered in PDF each week.

Request a reprint or permission to use this article.