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What is the state of tech salaries in 2022?

Missive

A new report*: 2022 State of Tech Salaries: Navigating an Uncertain Hiring Market provides one of the most in-depth analyses of the 2022 hiring environment – detailing insights on global compensation trends, benefits, and remote work shifts.

Key findings include a global increase in salaries across nearly all tech roles, driven primarily by the growth in salaries of experienced professionals (3+ years of experience). While Hired data shows the number of companies seeking to hire remote junior-level talent has grown, local salaries for junior-level candidates have failed to grow as quickly as salaries for professionals with more years of experience – potentially indicating salary pressures in current market conditions, with employers leaning heavier into hiring needs for more experienced talent.

Despite the growing appetite for remote positions, the 2022 average remote salaries in London are 3.6% less than salaries local to London – the lowest remote to local salaries percentage difference seen across all markets globally.

In terms of industries seeing the largest salary increases for U.K.-based roles, the entertainment industry has seen the largest growth, with a 17% increase in average salaries between 2020 and July 2021. Health is another high growth industry that has shown a 9% increase in salaries in the same time period.

As remote dominates as the preferred work model, remote salaries have continued to outpace local salaries (15 out of 17 markets had higher remote salaries, up from 13 markets in 2021) – with remote roles paying $3,000 (approx. £2,540) more on average globally. Interestingly, in the UK, Oxford and Cambridge saw a higher average salary (adjusted for cost of living) than London, with 2022 salaries at:

  • £88,108 in Oxford (up 27% 2021-22)
  • £87,976 in Cambridge (up 12.4% 2021-22)
  • £83,105 in London (up 8.3% 2021-22)

This is also reflected in Scotland, which also has a healthy average salary for technology roles, with an average of:

  • £80,886 in Edinburgh (up 13.2% 2021-22)
  • £79,736 in Glasgow (up 17.3% 2021-22)

“The hiring climate this year has been full of contradictions and challenges,” said Josh Brenner, Hired CEO. “We’ve seen climbing salaries, aggressive hiring, and layoffs – all at once. However, the hiring landscape remains competitive as companies innovate and diversify their teams through remote work. We’re seeing salaries rise globally as employers expand their talent pools and candidates find more opportunities outside their backyards. To ride out this storm of uncertainty, we recommend a shift from hyper-growth to more efficient growth. Be responsive and attentive to what’s important to employees, stay the course on DEI initiatives, and continue to nurture your employer brand.”

These findings are based on the analysis of more than 907,000 interview requests over 47,000 active positions, facilitated through Hired’s marketplace from January 2019 through June 2022. Hired also surveyed over 2,000 tech professionals on their salary, benefits, and flexible work preferences. This year, Hired also asked survey respondents for their sentiment around: cost of living challenges, salaries in light of inflation, DEI rollbacks as companies tighten resources, location versus role-based compensation, and willingness to take risks to job seek in a volatile market.

Additional key findings from the 2022 State of Tech Salaries report include: 

  • Time to acquire tech candidates has slowed across the US, UK, and Canada as companies and jobseekers are taking more time to evaluate offers. In 2022, the time to acquire tech candidates is up to a 60-day average time-to-hire in the U.S. and 68 days in the U.K. Remote roles took 40 days to fill, up slightly from 39 days in 2021.
  • Engineering management roles still pay the highest among tech roles across the US, UK and Canada. In the UK, full-time engineering management roles saw an average salary of £113,358, up from £107,205 in 2021 – a 7.93% increase YoY. The US sees highest local salaries for the role on average at $196,000 and Engineering Management remote salaries are $198,000 – the highest paying salary overall across every market globally. Also, roles outside of engineering (Design, Data Analytics, and Quality Assurance) saw the highest salary increases this year, with remote salaries for all roles rising in 2022.
  • Employers continue to expand talent pipelines and hiring across an increased number of markets and timezones – with remote-first employers having a competitive edge. Businesses of all sizes are more open to interviewing candidates from other locations (4.4 markets in 2022 up from 3.3 in the beginning of 2021). Candidates showed an increased preference for remote-only roles, with 32% of all active job seekers open to “Only Remote” roles on the Hired platform (as of June 2022), up from 18% in January 2022.
  • The salary gap is closing between startups and enterprise organisations. Salary levels at corporates (companies with 300+ employees) versus startups (companies with <300 employees) in the UK narrowed to the smallest pay difference to date since 2019, with corporates paying just 4.53% more on average (£84,061 vs. £80,419)
  • Candidates are still emboldened and willing to leave their current role for better fit and higher-paying opportunities. Even as Hired survey data shows some sentiment of a power shift to employers in the next six months (27% of employees feel that employers will have more power by 2023); if denied an expected raise in the next six months, the majority (90%) would start looking for a new job immediately, while half of respondents expect salary increases by 2023.
  • Despite the current economic climate, remote/flexible work remains a top priority for employees. When asked if they would be willing to return to work in the office, if it meant greater job security, over half (54%) of candidates stated yes, but would start looking for other jobs with more flexible remote work options immediately. Only 33% of respondents would trade remote work for a fully in-person role with a higher salary.
  • Practical benefits are now paramount in volatile economic conditions. Surveyed candidates’ most compelling benefits from 2021 to 2022 remained the same (flexible work, paid time off, and health insurance benefits), but this year candidates would be willing to trade in a higher salary for practical benefits (health insurance and 401K retirement matching) versus stock/equity in 2021.
  • Majority of surveyed candidates worry about deprioritised DEI efforts. 61% of surveyed candidates are worried the 2022 economic climate will lead to a rollback of DEI efforts, with 14% of respondents reporting they have already seen de-prioritisation.

*Report from Hired

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