09.18.2023
Tech Salary Negotiation Tips for Your Upcoming Career
By The Fullstack Academy Team
Tech Salary Negotiation Tips for Your Upcoming Career
People consider a variety of factors when contemplating job offers, but a 2022 Gallup survey found that pay and benefits were at the top of the list.
Despite their importance, not everyone negotiates pay and benefits with prospective employers as part of the hiring process. In fact, when Fidelity Investments surveyed young professionals in 2022, it found that:
58% accepted the offered compensation without any negotiation
The remaining 42% negotiated with their employers, and 87% of this group received at least a portion of the requested compensation
Conducting compensation negotiations—that is, holding specific discussions with prospective employers regarding salary and benefits—is particularly important in information technology (IT) due to the increasingly high demand for tech professionals.
Getting a job offer in IT, especially for individuals who are new to the field, can be an exciting career milestone. Before accepting an offer, however, it’s important to learn how to advocate for yourself and ensure that your compensation aligns with what you believe you deserve.
Becoming familiar with tech salary negotiation tips, tech starting salaries, reasons to negotiate, and other resources that help in the negotiation process can benefit anyone who works in IT.
What Are the Starting Salaries in the Tech Industry?
Before negotiating compensation for tech jobs, it’s important to do your homework. Knowledge is power, and becoming aware of compensation levels and salary trends helps establish a good foundation for salary negotiation.
The Big Picture: Business Growth and Transformation Depend on Information Technology Expertise
Individuals who are going into the salary negotiation process for tech jobs are starting from a position of strength. Employers seek candidates with IT expertise, and the chances of landing an offer with good compensation are favorable. Consider the following:
The World Economic Forum reported in 2023 that more than 85% of surveyed businesses cited adopting new technologies and expanding digital access as the biggest drivers of business transformation.
A survey by tech consulting firm Gartner found that 81% of chief information officers (CIOs) planned to expand their IT teams in 2023.
Consulting firm McKinsey & Co. reports on a continuing shortage of tech talent, referencing CompTIA’s data that shows that 316,000 tech jobs remain unfilled as of March 2023.
Tech Industry Salaries Are Relatively Attractive
Tech industry salaries are more favorable than salaries in other fields. According to the U.S. Bureau of Labor Statistics (BLS), the annual average wage for all occupations was $61,900 as of May 2022, but the annual average wages for occupations in tech were significantly higher, including:
$173,670 for computer and information system managers
$129,490 for computer network architects
$102,790 for computer programmers
Examples of Entry-Level Salaries in Information Technology
Sometimes, knowing what constitutes a reasonable salary request is difficult, particularly when starting out in a tech career. According to Glassdoor, as of May 2023, the average entry-level salaries for some common tech jobs in the U.S. were around:
$95,100 for development and operations (DevOps) engineers
$87,000 for software engineers and software developers
$74,000 for network architects
$73,600 for information security analysts
$66,700 for web developers
$62,500 for data analysts
$61,800 for systems administrators
Factors That Affect Tech Salaries
Experience, education, and more can affect tech salaries. Before negotiating salary levels for tech jobs, learn more about these factors and their effect on a prospective starting salary.
Here are some of the factors most commonly considered when determining a tech career's starting salary range:
Experience
As in many fields, work experience can affect tech salaries. For example, according to a study from tech career website Dice, in 2022, average tech salaries were around:
$65,800 for individuals with two or fewer years of experience
$81,900 for individuals with three to five years of experience
$95,100 for individuals with six to 10 years of experience
$111,100 for individuals with 11 to 15 years of experience
$128,800 for individuals with more than 15 years of experience
Education, Training, and Technology Skills
In general, earnings rise with each additional level of education that an individual attains, according to the BLS.
However, it’s important to know that, for tech jobs, employers are shifting from focusing on traditional education levels (i.e., an undergraduate or graduate degree) to focusing on training and skills, such as certifications in particular skills.
CompTIA reported that human resources leaders surveyed in 2022 were in favor of deemphasizing traditional degrees:
85% supported eliminating or relaxing requirements for tech job candidates to have a four-year degree.
76% noted that certifications were a factor in hiring for tech positions.
Geographic Location
When negotiating the salary for a tech job, don’t forget that the cost of living can vary significantly across the country, and the salaries reflect that. For example, according to Glassdoor, as of May 2023, the average entry-level salaries for web developers were around:
$79,600 in the San Francisco-Oakland-Hayward metro area of California
$67,100 in Jacksonville, Florida
$54,200 in the state of Oklahoma
Size and Development Stage of Employer
Employers’ size and stage of development can also affect salaries. You may think that startup salaries are lower than salaries at more established companies. However, as the technology career website CS Careerline reports, it depends on the specific employer. For example, job seekers may find that late-stage startups or even new startups with ample funding offer salaries higher than those of more established companies.
It’s also wise to consider the full compensation package that potential employers offer. A startup may offer a lower base salary than a larger company, but the relatively higher stock options that a startup may offer can be attractive. Startups may also offer certain types of benefits (such as flexible work schedules and opportunities to develop new skills) that more established companies may not.
Market Demand
Unsurprisingly, professionals with the most in-demand tech skills have even more leverage to negotiate higher salaries. Seven of the top 10 hard skills sought-after by employers are tech skills in:
Software development
Structured Query Language (SQL) programming language
Python programming language
Java programming language
Data analysis
JavaScript programming language
Cloud computing
Additional Resources on Tech Job Salaries and Trends
If you want to explore other resources on trends relevant to tech salary negotiations, review the following:
CNBC, “California Forces Companies to Show Pay on Job Listings, Revealing Big Tech Salaries”: This article sheds light on a new California law that requires employers to include salaries on job postings, making it easier for job seekers to gauge tech salary levels.
CompTIA, State of the Tech Workforce: This comprehensive analysis of trends in tech hiring and wages indicates that the median tech wage in the U.S. was 103% higher than the national median.
Hired, Navigating an Uncertain Hiring Market: 2022 State of Tech Salaries: This resource offers information on the tech hiring climate and tech compensation.
ISACA, Exploring the Relationship Between IT Certifications and Salaries: This article discusses the connection between earning tech certifications and tech compensation.
Janco Associates Inc., Mid Year 2023 IT Salary Survey by Company Size and Metro Area: This salary survey provides detailed information on tech salaries by employer size and geographic location.
McKinsey & Co., “Overcoming the Fear Factor in Hiring Tech Talent”: This analysis gives insight into employers’ thought processes when hiring tech talent and the corresponding effects on salaries.
U.S. Bureau of Labor Statistics, Computer and Information Technology Occupations: This information projects robust job growth of 15% through 2031 for computer and information technology occupations (a growth rate that’s much faster than the projected 5% growth rate for all occupations).
Why You Should Negotiate Your Tech Salary
Some tech candidates seek to improve their financial future by leveraging a higher starting salary, while others may simply seek the amount they feel they deserve. Negotiating your salary for a tech job is important for a host of reasons, as outlined below.
Initial Salaries Establish a Base for Future Raises
Your initial salary level can have a significant effect on future pay raises. Many employers offer raises as a percentage of an employee’s salary. Therefore, a 5% pay raise will equate to a bigger pay increase if you negotiate a higher starting salary than initially offered.
Negotiating Salaries Can Help Address Historical Pay Inequities
One way to address historical pay gaps and inequities that women and minorities experience is to negotiate salaries. For example, the National Women’s Law Center reports that negotiating compensation can narrow the gender gap in salaries. Similarly, the Society for Human Resource Management noted in 2021 that ensuring people of color negotiate their salaries is an important step in addressing pay inequities.
Desire to Negotiate Salary Reflects Individuals’ Confidence and Views of Their Skills
Negotiating salary is an opportunity for tech candidates to highlight the value of their skills to prospective employers. In addition to establishing a salary, negotiation is a chance to cite specific examples of how your skills can help an organization achieve its goals.
Employers Are Open to Negotiation
A 2021 CNBC report noted that many employers intentionally lower their initial salary offers to leave room for negotiation, even for entry-level jobs. Not negotiating and simply accepting the first salary offer that a prospective employer makes can leave money on the table.
Tactics for Navigating Tech Salary Negotiations
Knowing specific strategies for negotiating the salary for a tech job can increase the odds of a successful negotiation process. For example, the strategies discussed below can be helpful in a tech salary negotiation.
Be Polite and Professional
Remember to remain polite and professional during the salary negotiation process. Maintain the same high standards of etiquette that you would follow during a job interview and thank the prospective employer for the initial salary offer. Your demeanor during the negotiation process is a reflection of your professionalism and respect for the employer.
Negotiate After Receiving an Official Job Offer
You should wait until after receiving a job offer to discuss salary. Prospective employers may view launching into a salary discussion prematurely in a negative light. In addition, after receiving a job offer, you can negotiate your salary from a position of power, knowing that the employer views you as the best person for the position.
While it’s best to negotiate the salary for a tech job with an offer in hand, employers sometimes inquire about a candidate’s salary requirements before extending a job offer. In these cases, provide a range or say you would like to hear more details about the job first.
Sometimes, prospective employers ask job candidates to provide salary expectations at the very beginning of the process when they complete a job application. In these cases, you can specify a salary range or answer with the word “negotiable.”
Take Your Time
You should take time to develop a plan for salary negotiation. However, don’t leave the prospective employer hanging. Respond to an offer promptly by inquiring about whether it would be acceptable to consider the offer for one to two days. If this time frame is acceptable, then you should be specific about when you will contact the prospective employer again.
Conduct Research
Good research is the bedrock of good salary negotiation for a tech job. Researching fair pay rates online is a logical first step. Here are examples:
An analysis of various salary comparison websites helps job seekers develop reasonable salary requests.
A list of professional associations and salary survey resources assists job seekers in developing a starting point for salary negotiations.
When conducting research, reach out to professionals in your network who may have knowledge of reasonable pay.
Consider the Entire Compensation Package
Consider all the components of a compensation package when negotiating pay for a job in tech. Compensation includes not just a base salary but also additional components, such as:
Child care assistance
Employer-provided professional development and certification opportunities
Health insurance and fitness benefits
Mentoring and coaching opportunities
Tuition reimbursement
Paid time off
All components of compensation can be up for discussion during the tech salary negotiation process.
Consider Getting Help From an Expert
You’re not completely on your own when preparing to negotiate a tech job salary. Professional recruiters can assist job seekers during the salary negotiation process by:
Sharing industry expertise and knowledge of salary trends
Providing suggestions for managing discussions about salary levels
Giving honest feedback on the value of their skills
Career centers also have staff with the expertise to assist individuals during the tech salary negotiation process. The New York State Department of Labor, for example, has career centers that offer workshops on topics such as salary negotiations. Many tech bootcamps and higher education institutions also offer career services that include salary negotiation tips.
Make a Reasonable Counteroffer
Even after conducting research and consulting with professionals, making a salary counteroffer can be difficult. Typically, a reasonable counteroffer is 10% to 20% more than the initial offer (many employment websites also suggest this range).
Remember, whether a counteroffer is accepted or not can vary based on the particular circumstances at hand.
Prepare Justification for a Counteroffer
Don’t simply make a counteroffer without backing it up. Consider underscoring your strengths and the ways in which the company can benefit from your expertise. You can also cite work-related achievements at past employers to highlight how your strengths and skills will help in the new position.
Resources for Nailing Your Tech Salary Negotiation
Additional resources that can be valuable in negotiating salary levels for tech jobs include the following:
CompTIA, Calculate Your Potential IT Salary: This resource offers a salary calculator for tech careers that can provide estimated salaries based on position, experience, and geographic location.
Glassdoor, How to Write a Salary Negotiation Email: This resource offers advice for crafting emails to prospective employers about salary negotiations.
Indeed, 40 Effective Salary Negotiation Tips: This article provides 40 succinct tips regarding important considerations during salary negotiations.
Indeed, “Salary Negotiation Scripts to Counter Any Job Offer”: This article provides examples of wording that job candidates can use during a salary negotiation process.
Military.com, “10 Things Veterans Need to Know About Their First Salary Negotiation”: This article provides salary negotiation tips for veterans who are returning to the civilian workforce.
The New Stack, “How to Negotiate the Salary You Deserve”: This comprehensive resource for tech salary negotiation also cites red flags for job seekers to identify during the negotiation process.
New York State Department of Labor, New York State Salary Negotiation Guide: This guide offers extensive advice for the entire salary negotiation process.
U.S. News & World Report, “What to Say When Negotiating Salary in a Job Offer”: This article offers examples of language that job seekers can use during salary negotiations.
Get the Tech Salary You Deserve
Although many employers in the tech sector make good initial offers, negotiating a tech salary is still an important component of the job search process. Following tips in areas such as when to begin negotiations and how to develop a reasonable counteroffer can help ensure you receive compensation that aligns with the value of your skills.
Don’t sell yourself short. Engage in tech salary negotiations with confidence, knowing that potential employers will benefit from your expertise and skills.
