IT Wages Rise, But So May the Work Hours

IT professionals in Toronto should expect at least a 3.9 per cent increase in base salaries this year, but may have to pay the price of longer hours, according to a recent survey.

The Toronto Board of Trade’s annual executive compensation survey for the IT industry shows five per cent of employers report a longer work week for IT professionals, while 10 per cent of employers report a trend toward flexible hours.

Joanne Brady, senior vice-president of operations for Toronto-based Oasis Technologies and a Toronto Board of Trade survey committee member, doesn’t believe there is a real change in work hours.

Brady says she thinks in past years, employers underestimated, and underreported, the number of hours worked by their IT professionals. She says this survey shows a more accurate picture with IT employers reporting numbers much closer to the actual amount of hours put in by their technology workers.

The results also show almost half of the surveyed participants, including individuals from such companies as Symantec Corp., Ericsson Canada, Estee Lauder Cosmetics Ltd. and Rogers Communications, outsourced some of their IT functions last year, which Brady says reflects a couple of issues.

“I believe people are realizing IT can be very distracting to a core business if your core business is not related to technology. It’s very effective and efficient to outsource it,” she says. “On the other hand, if your business is technology, it can reduce employee satisfaction if (employees) are spending a lot of time on maintenance of IT rather than creation of new IT functions.”

Craig Kams, senior consultant of the UNIFI network for PricewaterhouseCoopers in Boston, explains companies outsource the IT function in order to cut costs.

“When (companies) outsource services, they are paying a price so they don’t have to keep these (IT) individuals on salary 365 days a year,” Kams says.

Brady also says there was a significant reduction in the granting of stock options to IT workers — a result, she says, that came as a surprise.

Kams says the trend in the United States is the complete opposite, with an increase in the amount of shares distributed. He says a reduction in the granting of stock options in Toronto is cause for concern because of the lack of IT professionals available.

“We are a global market,” he says. “If Canada is not competitive, people could easily go over the border into the U.S. What we are seeing is the U.S. tends to be more aggressive when it comes to compensation packages.”

This seems to be the case in Western Canada as well. According to Gail Evans, president of Calgary-based The Wynford Group, a consulting firm focused on organizational performance and reward strategies, Calgary and Vancouver continue to see the use of stock options as part of the attraction and retention strategies that are increasingly in use in those areas.

“(Alberta’s) salary increases are leading the country,” Evans says, quoting from an IT compensation survey conducted by The Wynford Group in September 2000. The survey shows Alberta technology workers can expect at least a 5.3 per cent increase in base salaries in 2001.

“The economic growth in Alberta is the highest in Canada, particularly in Calgary,” Evans says. “This is the hottest market in the country.”

Brady says, on the plus side, the Toronto Board of Trade survey reports a fairly low turnover rate for IT professionals.

“Surprisingly, the turnover rate in the industry was nine per cent. Historically, it has been up as high as 20 per cent on average,” she says. “This demonstrates IT professionals are becoming more satisfied in their positions.”