The corona virus pandemic has made organizations struggle to survive. Since offices are closed, moving forward has become a challenge. Remote tech employees have played a crucial role in helping organizations stay alive. Due to the increasing demand for skilled workers, salaries have increased around the globe. Over the last decade, tech salaries have grown consistently. However, the coronavirus pandemic is making world-class companies implement new strategies and philosophies. Reading this article will help you get a better idea of how tech wages have changed during Covid-19.
Remote Salary Adjustments
Remote work is today’s new standard. Remote employees can work from anywhere, and several have moved to cities with lower costs of living. For example, if you’re a web designer living and working in San Francisco, moving to Denver would be a good alternative. It may sound like a dream as your net earnings would be higher. But, it will only be a reality for some. Nowadays, Silicon Valley giants are already implementing location-based compensation policies in order to adjust salaries. In that case, no matter where you live, your payment will be adjusted depending on your current location.
Many organizations like Google and Netflix offer several on-site benefits and perks to their employees. However, most employees worked from home and couldn’t enjoy most of those perks. Today, top-notch companies are also considering to provide added compensation equal to on-site office perks.
Salary equity has been hard to achieve. The Hired’s 2020 State of Salaries report shows how equity initiatives are not making a meaningful impact. In 2020, white tech professionals are offered higher salaries than Hispanic and Black professionals with the same role. On the other hand, there’s also a substantial gap between women’s wages and men’s wages. In fact, according to the Hired’s wage inequality report, 60 percent of female professionals are paid less than their male peers with the same roles.
Job security is among the main factors that employees are worried about. Nevertheless, according to Hired’s report, tech talent is split on job security in the tech industry. Several articles are proclaiming that tech companies are not surviving but thriving during the coronavirus pandemic. Still, in reality, things can be more complicated than they seem.
During the coronavirus lockdown, many people visited websites like Career Karma to find the best coding bootcamps in the market. As a result, they could start a new learning process and add value to their toolbox.
Vocational schools have allowed jobless workers to get employed, but being laid off in the next six months is still a possibility. Hired’s salaries report also shows that 34 percent of surveyed individuals are very confident in finding another job if they are fired. Regarding pay increase, nearly half of tech employees expect to receive a pay raise in the next six months.
Offering remote positions has enabled companies to diversify more than ever. Coding schools are offering online courses overseas, and tech talent outside US borders is real. The competition has become tougher in the tech industry, and US employees may start to experience pay cuts if companies begin to hire international candidates. For example, in Mexico, the typical salary for a data scientist is $19,417 per year. In the US, on the other hand, the average salary is $113,309 per year. In other words, companies would spend, on average, $93,892 less if they hire a data scientist located in Mexico.
The Expectation Gap
Remote work has indeed allowed organizations to diversify a lot more. But, since existing equity, inclusion, and diversity initiatives aren’t sufficient, there’s a substantial gap in preferred salaries. For example, a Black tech professional would ask for lower compensation than their white peer with the same job title. The Hired’s 2020 State of Wage Inequality report has proven that there’s also a gender-based expectation gap. In 2020, 65 percent of the time, women would ask for a lower salary than men when applying for the same job. Geographically speaking, New York has the worst expectation gap, with female professionals expecting 11 percent less than males.
Generally speaking, remote work has reshaped the future of work, and offering schedule flexibility is necessary to meet employees’ needs. Tech salaries will tend to grow because tech workers are becoming vital for companies to operate. Regarding pay parity and transparency, there’s still a lot of work to do. Hopefully, racial bias, ageism, and discrimination will be reduced if companies start implementing new strategies to create new hiring standards.