Dive Brief:
- Coastal states have traditionally held the highest IT salaries, but the push to remote work let inland states gain ground, according to the 2022 IT Skills and Salary report by Skillsoft released last Wednesday.
- Indiana, Minnesota and Illinois rose to the top five, below No. 1 New Hampshire and No. 2 New Jersey. New Jersey was the only state to remain in the top five highest salaries from last year, according to the report, which surveyed nearly 8,000 IT staff members and decision makers.
- California, Virginia and Connecticut all reported lower average annual salaries than last year and dropped from the top five leaderboard.
Dive Insight:
New Hampshire IT pros make the most on average
Many of the largest tech companies are based on the coasts, leading to a concentration of talent. However, the pandemic and the push for remote work let companies to widen their nets.
“This is likely related to the increase in remote work and development of a distributed workforce following COVID[-19],” Orla Daly, CIO at Skillsoft, said in an email. “A number of individuals have elected to move outside of large cities and work remotely. Not all companies have recalibrated salaries as a result.”
Another driving factor is that many tech workers fled big coastal cities and moved to small and mid-sized cities within inland states. Technology-related job growth accelerated during the pandemic in metro areas such as Philadelphia, Minneapolis, Cincinnati and Nashville, Tennessee.
The decentralization has not abolished the reign of coastal states, but it has changed the landscape.
“All this is to say that so many companies are seeking skilled tech workers to help them transform their operations, and location has become less relevant,” Daly said. “This data also potentially indicates that inland states are feeling an increased sense of urgency to bring talent in to support their transformation initiatives.”
Landing atop the list this year, New Hampshire experienced a significant jump from not being in the top five last year. Similarly, Indiana, Minnesota and Illinois were not leaders in 2021 but now sit comfortably in the top five.
In New Hampshire, most tech workers hold roles in higher-paying functional areas of IT such as engineering or architect roles, according to Skillsoft. Not only are these professionals in demand, but 2 in 5 of those surveyed are team leaders, which typically comes with a higher salary compared to staff, according to the dataset.
On the other end of the spectrum, Alabama, which has the lowest average annual IT salary, is an example of the difference between contract and full-time employees.
Full-time employees typically make around $11,000 more annually than contract employees, according to Skillsoft. More than 8 in 10 IT professionals are contract employees in Alabama.
Salaries vary by company, region and role, but this difference explains why Alabama has a lower average annual salary than states with an even lower cost of living, such as Mississippi. Mississippi had more full-time employees that were later in their careers serving as senior leaders, according to the dataset. This difference, combined with more full-time employees, explains why Alabama ranked last.
