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IT Salary Trends CIOs Need to Know in 2024

Author

Alvaro Prieto

https://www.linkedin.com/in/aprieto/
alvaro.prieto@auxis.com

Senior Managing Director of Technology Services, Founder

In brief: 

  • The much-publicized layoffs of 2023 did not change the tech talent shortage issue in the United States, with nearly 4 million tech jobs available. 
  • 90% of tech managers say finding top talent remains a concern as several hiring challenges continue to persist. 
  • In-demand technology positions include cyber security, cloud computing, and software development; strong demand for mid to senior talent as well as those with project management experience. 
  • The ability to work remotely continues to be attractive to tech candidates; employers are offering hybrid or remote jobs as incentive to attract top talent. 

Despite the massive layoffs by major tech firms in 2023, driven by economic uncertainty and fears of a recession, the tech job market remains strong going into 2024. The tech economy has proven far more resilient than what was predicted, with tech unemployment rates trending well below the national average.

However, because of the unease in the market, average annual salaries saw a very modest increase of 2% on average in 2023, versus the nearly exponential growth trends over the past decade, according to Motion Recruitment’s 2024 Tech Salary Guide. Revenue growth and a continued emphasis on cost optimization have replaced talent acquisition as a top concern for enterprises, the Everest Group 2024 Key Issues Study found. 

But while neither employers nor tech workers seem to have the upper hand in today’s marketplace, most of the challenges faced by hiring managers in the last couple of years continue to persist in 2024. 

Understanding the labor statistics and tech salary trends shaping today’s IT market helps CIOs think strategically about the future of their departments. Here are tech talent trends to watch in 2024 – and the best solution for recruiting and retaining the high-quality resources you need to drive innovation, digital transformation, and growth for your business.

1. Tech talent shortage continues despite layoffs, but average salary growth slows 

2023 was an unusually bumpy year for the tech talent market, with mass layoffs led by FAANG companies (Meta, Apple, Amazon, Netflix, Alphabet). These companies, along with Microsoft, had been on a steady hiring spree since 2019, and accounted for 42% of all tech layoffs last year.  

However, contrary to expectations, this did not flood the candidate pool and make hiring easier. There continues to be a tech talent shortage across the United States, with nearly 4 million tech jobs available, according to Motion Recruitment.  

This can be attributed to a few factors: 

  • Talent reabsorption continues at an all-time high. 79% of people laid off last year found a new job within three months. 
  • Many non-tech companies were less affected by the conditions of early 2023 that led to layoffs, continuing to grow and hire tech resources. 
  • 63% of tech workers who were laid off started their own company within 12 months of losing their job. This wasn’t due to a lack of other options but to grow their skills, make more money, or create something new. This is emerging as a new contributor to the tech talent gap. 
  • Internal recruitment teams as well as HR and marketing teams at tech companies were hit harder, as opposed to tech positions, by layoffs last year. 

Given this, it is no surprise that finding top talent remains a challenge for 90% of tech managers, according to Robert Half’s 2024 Salary Guide

IT salary growth, on the other hand, has overall normalized after 2022’s hyperactive growth. Despite fears of hyperinflation having proven unfounded, most organizations in 2024 will be looking to ‘do more with less,’ prioritizing revenue growth and cost optimization over talent acquisition, Everest Group found. 

All this means that, breaking from the trend of the past few years, it is no longer a job candidate’s market with an abundance of opportunities and competing salaries on offer. But demand for critical technology skills remains as high as in previous years, with top-level talent still able to pick and choose from multiple offers.  

2. Demand, and salaries, for strategic and emerging technology skills remain high 

Even as enterprises look to optimize costs in 2024, they are continuing to accelerate adoption of technologies which are strategic and fundamental to growth. As a result, technology profiles including cyber security, cloud, software development, and data science and database management remain in demand and command top dollar. 

Hottest Technology Jobs and Average Salaries for 2024 Source: Robert Half Position