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US IT jobs and salaries stalled in 2020, but a slow recovery is under way

For the first time since the dot-com bust of 2000-2002, US IT salaries were flat in 2020, rising a negligible 0.08% to an average of $94,609 per year, according to the most recent survey of IT executives by management consultancy Janco Associates. The year also ended with 55,900 fewer jobs than the US IT industry had on Jan. 1, 2020 — a drop of 1.5% for the year. (Last week, the US Bureau of Labor Statistics [BLS] revised its figures for 2020, resulting in a revised drop of 55,900 versus the 81,100 reported previously.)

A separate survey by the industry association CompTIA, using BLS data, showed that the broad US tech industry showed job growth of 391,000 positions (22,000 of which were at tech vendors) in December 2020 — even as the US as a whole lost 140,000 jobs. About 44% of those tech sector jobs are for positions such as IT staff, software developers, and IT project managers; the rest are support positions such as sales, marketing, and management.

Janco’s survey focuses specifically on IT jobs, mainly people in a CIO’s organization, whereas the CompTIA survey looks at the entire tech sector.

The December growth in tech and IT jobs still left the broader tech sector below December 2019’s level, with 4.68 million jobs in December 2020, down from 4.73 million a year earlier. CompTIA’s survey shows a steady increase in tech jobs since July 2020, after a steep drop that began in March 2020 due to the COVID-19 pandemic.

The Janco survey showed that IT middle managers lost the most pay ground in 2020, with an average 0.08% salary reduction at large enterprises and 0.07% reduction at mid-sized enterprises. IT staff saw 0.03% average salary increases in large enterprises and 0.04% in medium enterprises. Executives did the best, of course: their salaries were up 0.59% in large enterprises and up 0.35% in medium ones.

April and May were the worst months for US IT jobs in 2020, Janco’s data shows. In those months, 116,000 IT pros lost their jobs due to COVID-19 pandemic shutdowns. Hiring partially recovered in later months, but the total of 3.58 million US IT jobs in 2020 remained below 2019’s 3.64 million (but slightly above 2018’s 3.54 million).

Janco notes that IT consulting and contract positions meant to augment IT staff were all but eliminated in 2020 and hiring growth stalled in the second wave of lockdowns that began in the fall as COVID-19 infections resurged. Those infection rates continue to grow in early 2021; Janco’s interviews with 101 US CIOs reveal that they don’t expect IT job or salary growth in 2021.

Still, IT was fortunate in 2020 compared to many other industries. The COVID-19 pandemic devastated many industries, eliminating jobs at an unprecedented scale in the travel, hospitality, entertainment, and events businesses. Retailers with physical stores faced massive job losses as well, though manufacturing has largely bounced back. The US overall had 9.4% fewer jobs as of June 30 (the latest data available) compared to 2019, the BLS reported. The tech unemployment rate has been roghly half that of the national rate throughout the pandemic, ending at 3% in December 2020 versus 6.7% for the economy as a whole, CompTIA reported.

Despite those massive losses in multiple industries, the average US salary rose 2.6% in 2020, according to the PayScale salary survey, which was last updated on Oct. 12. The latest data from the BLS, which covers the first half of 2020, showed an 8.6% average salary increase from a year earlier. Some of the salary increases reflect higher pay for grocery workers, delivery drivers, and warehouse workers whose jobs became more critical during the lockdowns and who were at greater risk of contracting the virus in their work.

Of course, people who lost their jobs aren’t included in salary surveys, so those figures reflect the pay of the still-employed.

CompTIA reports that software developers had the largest employment gains (4,700 hires) in December, triple that of the next-largest group, systems analysts (1,400 hires).

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