Pay in IT: How age affects salary and progress

Chart 1. Older employees get smaller pay awards in IT, according to XpertHR's Computer Staff Salary Survey for June 2015
Chart 1. Older employees get smaller pay awards, according to XpertHR's Computer Staff Salary Survey for June 2015

Technology professionals get fewer promotions, lower performance ratings and reduced pay increases once they hit the age of 50, analysis of XpertHR’s Computer Staff Salary Survey reveals.

Data on 40,000 individual IT staff in the survey shows that both pay increases and promotions peak at the start of people’s careers as they become proficient in their job and move steadily up the organisational ladder.

For younger employees average annual pay increases can exceed 10%, but increases in pay in IT then falls gently to a low of 3% for those aged 60 (see chart 1, above).

Similarly, almost one employee in five in their early years of employment can expect to be promoted each year. The rate of promotion drops rapidly for those in their late 20s before the decline slows (see chart 2). By the age of 50, just 7% can expect to be promoted each year.

Chart 2 Promotions become substantially less common past the age of 30.

Chart 2. Promotions become substantially less common past the age of 30.

Perhaps more unexpectedly, the data also reveals that performance ratings handed out in annual appraisals also tail off for IT professionals over the age of 40 (see chart 3).

The proportion of staff judged to be exceeding expectations rises steeply from around 12% for those aged 20 to just over 30% for those aged 30. This rate then holds steady for those aged 30-50 before dropping slowly to 20% for those aged 60.

Chart 3 Top performance ratings tail off for those aged over 40.

Chart 3. Top performance ratings tail off for those aged over 40.

As chart 4 below shows, the net impact of these age-related changes is that pay in IT rises steadily from an average of just under £20,000 for those aged 20 to over £50,000 for those aged 50 before gently dropping back for the oldest employees.

Age catches up with all of us, even when it comes to reward. If you are an older employee in the information technology sector then then the above analysis represents mixed news – do top performance ratings for older employees outside of senior management really need to be so infrequent? Overall, however, the picture painted by our final set of data is positive.

Chart 4 Older employees receive more pay in IT than average.

Chart 4. Older employees earn more on average.

The analysis is based on anonymised individual data supplied by employers for XpertHR’s June 2015 Computer Staff Salary Survey. In all, 195 employers provided data on 67,560 IT professionals, 40,000 of which had compensation history and demographic information.

Data collection for the December 2015 edition of the computer staff survey runs throughout the Autumn with the latest IT pay intelligence released to subscribers before Christmas. Find out more here.

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