What are your forecasts for this industry? What are the opportunities and risks?
IT professionals are able to exploit the fact that no company can exist without well functioning IT, and are thus generally in a strong position. Over the past 10-15 years, every single industry has used IT to evolve in some way. With the advent of smartphones, technological developments combined with mobility have turned nearly every industry upside down. While there is a strong demand for IT professionals on the job market, one risk is that IT services can always be outsourced to more favourable countries. Standardized and back-office IT operations are offshored to low-wage countries. Basic IT services are purchased in China, India or South East Asia at a fraction of Western prices – and even if the quality is not quite as high, it still makes economic sense for the company. For an ordinary Western IT employee with standard skills, globalization brings with it the risk that the jobs will migrate to South-East Asia.
“An IT specialist who is not up-to-date is surplus to market requirements."
An IT professional must become specialised and provide services which cannot be found as easily in other countries. Technology develops at breakneck pace, and there is no demand for an IT specialist whose knowledge is obsolete. Twenty to thirty years ago we made big money with hardware; then came the software era, then apps, and now everything is in the cloud. Today there is nobody who knows the themes and challenges of tomorrow’s technologies.
What role does education play?
Formal education plays a relatively minor role in specialist functions. It is important that employees deliver services for which there is a demand – it does not matter whether or not you have completed a vocational IT education. Training for management positions, where university graduates are mostly preferred, may create the biggest difference, but this is not an absolute necessity. It is also interesting to note that there is not much difference between the respective salaries of IT specialists with university or vocational educations. This contrasts sharply with other sectors, where salaries may depend heavily on a employee’s degree and professional experience.
What impact does continuous training have on salaries?
IT is in a constant state of flux, so advanced training plays a very important role. It is vital to be familiar with all the latest developments. Anyone who thinks that it is possible to “complete” an IT education in college or university and then work in the field for the next 20-30 years is making a fundamental error. Lifelong learning is important for everyone, but absolutely essential for IT professionals.
How quickly can you make a career in the IT industry?
IT careers are usually achieved within ten to fifteen years. At that point, it is time to decide whether to accept management responsibility or stay in a specialist position. An IT specialist who declines a management position and prefers to remain a developer is essentially putting the brakes on his career. Specialists earn 60-80,000 Euros per year and remain at this level. There is also the question of independence – whether to be an employee or a contractor. Over the past fifteen years I have observed that independence is great in good times, because a consultant can earn much more than a regular employee, but the inverse is true when the economy takes a hit. We all remember the dot-com bubble! When times are hard, companies limit their budgets, and it becomes more difficult to sell large projects.
In conclusion: Do you have any tips on compensation in this industry?
Stay up-to-date, stay relevant: lifelong IT education must be your top priority. If you take the self-employment path, accept the inevitability of economic cycles, and try to earn enough in good times to carry you through the bad times.
Conrad Pramböck is the Head of Compensation Consulting at Pedersen & Partners. Based in Vienna, Austria, he is responsible for consulting companies on all aspects of compensation, including providing companies with up-to-date market information on salary ranges and design of bonus systems across all industries and geographies. Prior to joining the firm, Mr. Pramböck held several senior positions in international consultancy firms. He started his career with a German Consultancy firm working in management consulting and later in the Compensation Consulting business unit based in Austria. For the following seven years he worked with one of the top Austrian Executive Search firms as the Head of Compensation Consulting. He was responsible for all international compensation consulting activities and developed and maintained an international compensation database in 40 countries.