IT salaries rise 4.5 percent in Australia

Salaries for ICT professionals have risen 4.5 percent in the past 12 months, a slight increase on the 4.3 percent reported in 2006, according to the Australian Computer Society’s (ACS) annual remuneration survey released Friday.

Conducted by the Association of Professional Engineers, Scientists and Managers (APESMA) on behalf of the ACS it covers the 12 month period to May 2007 and surveyed 1588 respondents. The survey has been published since 1993.

The results are underpinned by an overall solid ICT sector performance since 2003. In fact, the private sector recorded a 4.6 percent increase, the education sector was even higher at 4.7 percent compared to 4.1 percent in the public sector.

The increase in rates charged by independent contractors, compared to the previous year’s study supports the view that the IT sector has continued to rebound over the course of the year.

Although rates charged by independent contractors generally fell within a range of A$65 (US$47) to $110 per hour, depending on the nature of work undertaken, 47.5 percent of independent contractors increased their rates during the course of the year and 47 percent of respondents said they held their rates steady throughout the year.

In real terms, the salaries of most ICT professionals have increased slightly taking into account cost of living increases across the corresponding period.

The Australian Bureau of Statistics (ABS) reported an increase in the Consumer Price Index (CPI) of 2.4 percent over the twelve month period.

However, in relative terms, the incomes of ICT professionals are keeping pace with most other technical professions which reported increases over a corresponding period in the order of four to five percent. Increases for ICT employees generally lagged increases enjoyed by professionals in the booming resources sector, where average increases were in the order of five to 10 percent over the last year.

In the twelve months to February 2007, the Australian Bureau of Statistics (ABS) reported Australian Average Weekly Earnings increasing by 3.4 percent just under the rate of increases reported by ICT professionals in the ACS Remuneration Survey.

Over the last year, while some ICT professionals with scarce skills have enjoyed salary increases of up to 10 to 15 percent, one in 10 employees received little or no increase.

The strongest level of demand was reported by those working in the consulting industry where 67 percent of respondents reported levels of demand being substantially higher than a year earlier.

Levels of demand, while still solid, were comparatively lower in the education, retail and manufacturing sectors. Per industry, salary increases were: insurance 5.8 percent; consulting 5.3 percent; education 4.7 percent; banking/finance 4.5 percent; defense 4.4 percent; public administration 4.3 percent; retail 4.1 percent; and health 3.3 percent.

ACS President Philip Argy said the industry has experienced strong performance in the ICT service exports sector, which increased to $2.7 billion in 2006 from $2.2 billion in 2005 and was highlighted in the 2007 Australian ICT Trade Update.

Argy said demand for IT professionals is now at its highest level since July 2001, according to statistics from the Department of Employment and Workplace Relations.

As a result, he said salaries for ICT professionals are likely to continue to increase by an average of four to five percent over the next 12 months.

“The increasing demand for IT professionals is a result of the declining supply of graduates due to falling enrolments and the aging of the workforce,” Argy said.

“The ACS is working on numerous initiatives, including our work with the Industry Leadership Group and the AIIA to develop and facilitate participation in ICT study and careers.

“Globalization has had a significant impact on the resourcing and management of ICT projects in recent years. It has also affected the skill set required of ICT professionals.

Today’s ICT workers are not only expected to have the appropriate qualifications, they must also practice professionalism in order to be competitive.”

Argy said demand for ICT professionals is also being driven by multibillion dollar federal and state government infrastructure projects and considerable private sector investment, as organizations aim to increase their security, service levels and international competitiveness.

One example of a federal department struggling with a serious ICT skills shortage is the Australian Defence Force (ADF).

The ADF will spend $215 million in training and support over the next decade as it will need 12,000 new employees during this time with 25 percent coming from an engineering background.

Only this week, the ADF announced the establishment of a joint defense-industry training taskforce to pool resources with the private sector.

Minister assisting the Minister for Defense, Bruce Billson, said the taskforce is examining a range of joint training initiatives.

“The taskforce is ideally placed to make well-informed strategic training recommendations to shape the skills and training of Australia’s wider defense sector,” he said.

The joint task force is set to report its recommendations in late August, 2007.

The taskforce will deliver its recommendations in the second half of 2007.

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