* The 2004 Compensation and Entrepreneurship Report in Information Technology study
Salaries for executives at private high-tech firms inched up 1.9% in 2003, down from the 2.9% increase incurred from 2001 to 2002. That’s according to the 2004 Compensation and Entrepreneurship Report in Information Technology study.
Executive search firm J. Robert Scott, law firm Wilmer Cutler Pickering Hale and Dorr, and consultancy Ernst & Young sponsored the study. Conducted last winter, the research is based on responses from 170 privately-held IT firms in the software, communications, hardware, semi-conductors and electronics, services, consulting and integration, and content and information providers segments.
Although the salary raises were modest, techies fared better when it came to bonuses. Bonuses were up 15.6% across all positions in 2003. Broken down by position, the incentives were relatively larger for head of sales, head of marketing and CFO positions.
These bonuses also accounted for a larger percentage of base salary in 2003 than in previous years. These monies represented 21.9% of base salary across all executive positions in 2003, up from 19.3% in 2002.
Equity holdings stayed stable between 2002 and 2003. According to the survey, 72% of high-tech firms use stock options for time of hire grants. Another 16% use both stock and options, 3% use only stock, and 9% use other equity vehicles or have no grant equity plan.
Severance plans decreased slightly, indicating that company owners may prefer executives who have a greater tolerance for personal risk and commitment. Of those surveyed, 28% had a severance package in 2003, down from 33% in 2002. CEOs and heads of professional services had the longest severance packages, netting a median of nine months.
For more information, download the abridged results of the salary study at www.compstudy.com. The full report is free to survey respondents and costs $350 for non-participants.
