Welcome to Software Technology Magazine.

Gloom, doom, and demise among the dot-coms have not killed the goose that lays the golden E-eggs, according to data and surveys by Data Masters, ComputerJobs.com, Salary, Inc., the Software Developer's Consortium, and the Department of Labor's Bureau of Labor Statistics.

Aggressive hiring by major U.S. and international corporations, fueled by their realization that there is an ever stronger competitive need to bring certain aspects of their business operations into the nascent arena of E-Business, Web-based communications and forms processing, E-OpsSupport, and E-Commerce — combined with thinly-traded volumes of bodies having true E-systems expertise and experience — has kept base salaries for new hires in line with brethren hired during the go-go heydays of late '99 and early 2000.

Salary Specifics

A weighted composite of the referenced sources provided average overall base salaries of $89,000 for all development-related personnel, breaking down to $87,000 for developer-and-technologists and $98,000 for CTOs and development managers. This represents an actual 3.5% increase over the numbers computed for the previous year, adjusted for inflation and international exchange rates. Overall base salaries for women and men were $79,000 and $91,000, respectively.

The noted exception, as expected by analysts and reported in the July, 2001issue of Software Technology Magazine, is that the average of JAVA developers' salaries has fallen below $100,000 for full-time developers and managers of four or more years' experience for the first time since early 1997. This sudden drop is attributed to several factors, including the slowdown in number of individual new Web sites, Microsoft's dropping out of the JAVA standards group and its declaration of operating system non-support for any JAVA virtual engines in future versions, productivity problems in using certain toolkits and SDKs, and the discovery that JAVA did not result in the portability nor have all the object-oriented benefits that were expected.

Apart from specific situations related to rescuing projects on the verge of failure, bonuses, conditional cash payments, and contracted perks fell dramatically, depressing the overall total compensation picture for both new hires and old pro's as well. While almost half the bonuses in the year 2000 exceeded $22,000, this year's estimated number will barely clear a much-reduced $7,000. Incorporating the imputed value of removed car leases, lost or degraded health plans, etc., overall total compensation fell by $9,000 to a weighted composite of $91,000.

Web Startups Decline; Spread between Richest and Poorest Widens

Though the overall percentage working on Web sites and E-business, etc., projects remained steady at 29.5% relative to last year's 28.9%. However, the overall portion associated with dot-com startups declined from 9.3% to 6.9%. Compensation among these groups varied wildly, with non-dot-com E-business developers' incomes rising 14.3% while that of startup dot-commers (defined as those joining new businesses started on or after January 1, 2000) plunged by 36.5%.

Statistical outliers from the Bell curve abounded, and salaries for legendary pro's and nationwide gunslingers increased a hefty 12%. The highest salary we were able to verify was a longtime Microsoft software architect (other than Bill Gates, of course) with a base pay of $385,000 — not including stock options. The lowest was $19,500 for a long-time COBOL developer working for local government for a State in the Deep South.

Little Change in Geographical, Industry-Wide Ratios

Reportage cutting across SIC Industry codes show breakout as a proportion of industry activity were static for 2001: 9.5% of developers worked in the manufacturing sector, 7.3% for government, and just under 4% each for health care, telecommunications, aerospace, logic hardware (includes firmware operating systems for computer, military, and robotic hardware), and banking-and-finance. Efforts related to producers of computer operating systems and software accounted for 28%.

As expected, California dominates the developer population with 11.8% of all technologists and development managers, where stratospheric salaries are somewhat offset by the highest standard of living in the country — particularly, of course, in Silicon Valley, where it is hard to find a house up for sale for less than a cool $1 Mil.

California is followed by Washington State (due in part to Microsoft, no doubt), which, for the first time, edged out New York and Texas for the #2 spot. Were it not for the fact that the suburbs of Washington, D.C. is spread among three states, this area of 100-mile radius would alone grab the #3 spot. New Jersey, Massachusetts, and Florida vie for remaining spots, but data varies by source and allocational definitions is sufficiently vague to make specific hard rankings of these states unwise.

Age, Education, and International Citizenship Distributions

Median age for software development personnel in the statistical populations amounted to 35 for developers and technologists and 38 for management. Personnel involved in Web and E-business sectors, not surprisingly, peaked out at slightly over five years younger, rounding out to 29 for d-and-t's and 33 for managers.

By and large, developers are among the nation's most well-educated professionals: 53% held bachelor's or higher in computer science or related areas, while 41% had bachelor's or higher in other fields. Thirty-three percent (33%) of the data population held masters or PhD degrees in computer science or related topics.

Takers of H1B visas were few relative to the hundreds of thousands of slots allocated over the next five years. This was seen as a rejection by most well-educated, well-paid foreign developers and technologists — rejection of a system that would result in years' absence from their homeland, with no guarantee of ending in the oft-sought-after U.S. citizenship payoff. Nations providing the highest number of applicants for the program included Taiwan, China, and overseas Chinese (one category), India, Canada, England, Germany, Pakistan, Hungary, Korea, Australia, Russia, and a smattering among 81 others. Owing to a higher concentration of advanced degrees, developers reporting Chinese origin topped the international charts, followed by software development employees of Indian, Canadian, Japanese, and German descent.

Gender and Regional Demographics

Women in the studies comprised 18% of the total population samples, and men represented 82%. While women made up nearly one-third of software testing and QA staffs, their male counterparts accounted for an overwhelming 93% of hard-core software coding and software systems design. Women in database development faired better — particularly in Federal, State, and Local Government fields — accounting for 22% of all developers and managers.

Regional differences relative to the national medians for software developers-and-technologists vs. management classifications are as follows: West Coast — San Francisco and Silicon Valley Areas, $+23,000 and $+27,000, respectively; South West — including Southern California, $+7,000 and $+6,000; North West — including Oregon, Seattle and Microsoft, $+17,000 and $+21,000; North Central states, $-8,000 and $-6,000; South Central — including Texas and New Mexico, $-1,000 and $+3,000; New England and North East, $+5,000 and $+4,000, Mid-Atlantic area — including Atlanta, New York and Washington, $+10,000 and $+18,000, and South East, $-19,000 and $-18,000.

Professional and Managerial Categories

High turnover remained a key characteristic of the software development industry, with nearly 34% reporting calls from headhunters in the 9/2000 to 9/2001 polling and statistics season. Mid-career developers averaged $77,000, while senior software engineers rose to $87,000. But software architects topped the charts for developers and technologists at a median of $104,000. Entry-level and straight programmers and systems analysts averaged $68,000

Among managers, entry and mid-level leadership and supervisory capacities averaged $89,000 and project managers drew a median of $94,000 while combined senior-level and vice presidential categories averaged to $97,000 and CTOs of major organizations plus software leadership heads of top development and production companies soared to a record $168,000.

Breakout by Software Technology

Until recently, C and C++ systems, communications, and applications-support developers have always tended to top the list, for example, at $92,000 for the year 2000, with, surprisingly, the PC-server proprietary software systems Oracle, Sybase, Informix, and SQL Server being close to the bottom of the major new technologies, rounding out at $83,000. However, the Web and E-business information explosion has driven all categories higher and has resulted in a significant flattening of technology salary differentials. Yet, while salaries among these technical areas are equivalent, hiring volumes are far from it — for example, JAVA salaries are on the wane, C and C++ hires are few and far between, and experienced database personnel are quite hard to come by — and hiring volumes in the 2001 survey for skilled database developers are, proportionally, massive.

One dynamic phenomenon that leaps out of the numbers is a sudden new trend by large corporations and government entities to break into the long-impenetrable mainframe and legacy data centers, thus connecting them with the Internet, the enterprise's customers and outside enterprises, drawing and mixing data with other 'stovepipe' corporate and governmental functions, and integrating the enterprise with the international "world at large." This phenomenon shows up in the stunning leap in advanced developer COBOL salaries (for tapping into the mainframe and its archives and databases) and the highly-skilled CORBA object-oriented middleware programmers who can connect mainframes and legacy systems to professional-strength UNIX-based systems.

While not an unexpected trend, the impact on salaries and hiring proves to be dramatic. For example, while the current salary-topping categories of C/C++ and Oracle programmers earned $103,000 for the pan-national average, just nudging ahead of other fields including advanced new-code COBOL programmers at $99,000, CORBA developers and managers jumped $+6,000 ahead of the pack, riding the new-trends escalator to $109,000 (these relatively high salaries reflect both differences between new hires and mid-career personnel, where inflation and demand boost new hires substantially higher in real-income terms, AND differences in new-system developers over maintenance programmers).

Breakout by Functional Category

The classical functional groupings of Internet Development, Applications Design, Applications Development, Systems Design and Development, Software Testing and Quality Control, Maintenance and Project Management may have less meaning in today's interconnected world, but for consistency with historical figures, they have been retained. All figures in this section will refer to nationwide medians unless otherwise specified.

Internet Development rose to $80,000 for development personnel and $107,000 for development managers, respectively. Applications Design climbed slightly to $94,000 and $99,000, while Applications Development stayed flat at $80,000 and $98,000. Systems design and development (comprised of integrated turnkey systems, communications systems, operating systems, and related products) rose substantially to $99,000 and $128,000.

Software Testing and Quality Assurance dipped slightly to $74,000 and $89,000. Maintenance "development" fetched just $66,000 and $71,000, while Project Management stayed flat or slightly declining to $86,000 (staff support plus line management) and $107,000 for the head-of-the-works levels.

Median base salaries by developer title, ranked from highest to lowest, are as follows: Software Architect, $105,000, Technical Project Leader, $92,000, Software Engineer, $85,000, Software Developer, $83,000, Database Administrator, $82,000, Systems Analyst, $79,000, Software Testing and QA Engineer, $79,000, Programmer/Analyst, $68,000, and Programmer/Associate, $63,000.

Salaries by management title, ranked similarly, spread over a wider range: Chief Technology Officer (CTO), $144,000, Vice President (of Development, etc.), $132,000, Chief (managing) Architect, 128,000, Director, $117,000, (General) Manager, $98,000, Project Manager, $96,000, Senior (Managing) Software Engineer, $92,000, Quality Assurance Manager, $86,000, and Supervisor, $76,000.

Scaling the Peaks of Mount Everest: E-business Integration Top the Charts

Record precedence-breaking salaries have been reported for the new-and-narrow but rapidly growing specialization categories within the Internet and E-business-integration arenas. While the clich� goes that "a rising tide lifts all boats" — and despite the legendary killing fields of the dot coms — overall demand for software development has rocketed (some analysts are drawing comparisons with doctors and financial lawyers — e.g., in boom times they're packing 'em in for new business incorporations, and in bust times the line stretches around the block for bankruptcies).

For example, the Pentagon recently sent Congress a report describing in professional-but-desperate-sounding terms that new-force modernization — plus an astonishing volume of new requirements necessary to combat international terrorism — have escalated estimated contractor-developer-head needs by +38% for the 2002 fiscal year alone. Lifting off the launching pad on its pan-governmental G2B, G2C and G2G Web initiatives, the Federal departments are in the midst of (insiders say a panic of) major systems consolidation, major systems linking to the outside world, CIO-driven reorganizations, and major legacy-systems overhauls (to wit, the IRS, FAA, FBI and DoJ, the DoE, FEMA, Department of Agriculture, and a long laundry list of system- and data-impaired agencies).

Hiring agencies are seeing spectacular salary spikes for E-business-integration-savvy software designers and coders of the right experience level (which, owing to the newness of E-business, is of necessity remarkably short). Three- and five-year employment contracts are not uncommon. While registered offers display thinly traded volumes, top salaries of E-business and Enterprise Application Integration (EAI) professionals with more than passing experience in multiple disciplines (e.g., Supply Chain Management (SCM), Customer Relations Management (CRM), Enterprise Resource Planning (ERP), and general E-Commerce and E-OpsSupport activities, etc.) are fetching up to $180,000 in record numbers (over two or three thousand in the period of analysis — all numbers represent 75th percentile of total distribution per category). Demand for middleware specialists and software architects in this field has jumped eight-fold from the prior year.

Representative hires and anecdotal examples abound. Examples:

Software and Data Systems Architect in Oracle and PeopleSoft, 10 years experience in current skill set, age 30-34, $125,000.

Enterprise Integration Architect (EIA) in Internet protocols and languages, Java, and Oracle, 2 years, age 40-44, $165,000.

Software Architect in Sun Solaris, Java, and Oracle, 2 years, age 30-34, $160,000.

Architect, E-Systems Integration in XML, Java, SQL Server, and Oracle, 4 years, age 31-35, PhD, $260,000.

Software Systems Architect in XML, Sun, Internet languages, and WebSphere, 1 year, 45-49, Masters degree, $140,000.

Software Systems Architect in XML, Java, ColdFusion, and Web personalization tools, 4 years, age 35-39, $150,000.

Software Systems Architect in XML, DW analysis, and Marketing/Sales, 8 years experience, age 35-39, $164,000.

Software Systems Architect in XML, Sun, Oracle, 4 years, age 44-49, $181,000

Software Architect in Visual Basic, Oracle, Visual C++, 2 years, 30-34, $135,000.

System Architect in Visual Basic, ActiveX, .Net methodology, 2 years, 35-39, $180,000.

Software Architect in Mainframe Integration, SCM, CRM, ERP and Web Portals, 5 years, 50-55, $375,000.

In the professional software design arena covering various means of integrating enterprise legacy systems with Web portal, Internet, and other E-business systems, medians for Software System Architects in the major cities of San Francisco, Seattle, Houston, Boston, Washington, D.C., and New York topped $180,000 in the 75th (high) percentile.

Whether large enterprises such as the major components of the Federal Government and the divisions of the Fortune 500 continue to support consumerism and expand peacetime E-business capabilities, or, on a wartime footing, react swiftly and strongly to this new era of international terror — producing weapons and materials for national security and overseas combat — it seems clear that software developers, their organizations, and the new entrepreneurial companies yet to be formed, will be in demand — more than ever before.