Financial services firms try to scrimp on IT pay

If financial services firms reduce IT pay rates, they'll lose top talent to other industries, warns Jack Cullen, president of IT staffing and recruiting firm Modis

At a time when most IT hiring managers are mulling pay increases to attract in-demand talent, there's a trend among financial services firms to reduce IT pay, according to one IT staffing firm.

"Some of the larger financial institutions are trying to cut some rates," says Jack Cullen, president of IT staffing and recruiting firm Modis. "That's the only industry we're seeing this in."

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It started with one firm and others have followed suit, according to Cullen, who says the financial services industry is the largest sector served by Modis, which has 70 offices in the U.S., Canada and Europe. "When one does it, they all start trying to do it. It becomes very epidemic," Cullen says. "None of them wants to be the one paying more."

The attempted pay cuts come at a time when many hiring managers are competing for IT talent.

The number of available IT jobs in the U.S. is up about 12% compared to a year ago, and demand for tech professionals is expected to grow this year, according to Dice.com. Among 1,200 IT hiring managers and recruiters surveyed by Dice, 65% said they're planning to add tech pros in the first half of 2012. Of those in hiring mode, 27% said they plan to expand headcount by more than 20%.

Tech pros with desirable skills and relevant experience aren't having any trouble finding jobs. "The market is very strong," Cullen says. "If candidates have strong skills, robust backgrounds, and they communicate well, they're getting snapped up fast."

In the financial services industry, top IT talent won't stick around for less pay, Cullen warns. "This is definitely going to create some turnover. The skills are transferable, they'll move to another sector."

Ann Bednarz covers IT careers, outsourcing and Internet culture for Network World. Follow Ann on Twitter at @annbednarz and check out her blog, Occupational Hazards. Her e-mail address is abednarz@nww.com.

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