Tech workers reported feeling increasingly dissatisfied with their salaries. Layoffs may be fueling the frustration.
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- Tech workers made an average salary of $111,193 last year — but 35% of them weren't happy about it.
- One reason for salary dissatisfaction: layoffs across the tech industry, a Dice study found.
- Employers are "right-sizing staff and their salaries" and limiting pay increases, Dice's CEO said.
Some tech workers don't seem to be too happy making an average salary of a little over six figures, a recent Dice study found, and industry job cuts may be one reason they're becoming increasingly frustrated with their compensation.
Researchers at the tech job board surveyed 6,166 of the site's registered users and visitors near the end of 2023 to understand how tech workers feel about their salaries. Their jobs included solution architects and software engineers making upwards of $100,000 a year on average as well as technical writers and help desk technicians who make below six figures, among others.
The study found that the tech workers surveyed had an average annual salary of $111,193. That's a slight dip from the average salary researchers' found in last year's survey, according to Dice. The average American working full-time, in comparison, makes $59,384 a year, according to salary data from the US Bureau of Labor Statistics as of Q4 2023.
But despite making almost double the amount the typical American does, tech workers surveyed reported feeling increasingly dissatisfied with their salaries. 35% of workers surveyed last year reported feeling "somewhat" or "very" dissatisfied with their pay — a 5% jump from 2022, according to the study.
"Considering the slowdown of salary growth, this is not surprising," Dice wrote in its study regarding its findings on pay dissatisfaction. "Significantly more tech professionals (12%) reported that their salaries went down this year; In 2022, only 6% reported a decreased salary."
Among those who reported feeling dissatisfied with how much they were making, satisfaction levels varied based on age and how far employees were in their careers. Tech workers early in their careers reported feeling more dissatisfied with how much they make than those with over 15 years of experience.
So, why does there appear to be an uptick in tech professionals who aren't content with their incomes? Mass layoffs across the tech sector may be one reason.
'Companies are right-sizing staff and their salaries'
In 2023, tech companies like Meta, Amazon, and Google laid off close to 263,000 tech employees, according to Layoffs.fyi in an effort to cut costs. As of March, more than 49,000 tech jobs have already been slashed this year, per the layoff tracker, and analysts expect more cuts to come as companies turn their focus toward generative AI and hiring AI talent.
The tech industry is famous for sky-high compensation packages, sometimes as much as $718,000 a year for software engineering roles.
But now tech giants don't seem to be offering salaries as high as they used to, according to Dice, and workers may find it harder to land another job with a comparable base pay — which could lead to frustration.
"Tech salaries skyrocketed in 2021 and 2022 as we emerged from the pandemic," Art Zeile, the CEO of Dice, told Business Insider. "Now that companies are right-sizing staff and their salaries, they're also limiting bigger increases on salaries that became standard in previous years."
J.T. O'Donnell, the founder and CEO of career-coaching service Work It Daily, would agree. Tech workers who were let go, she said, now have to compete for a limited supply of jobs that may pay less than the amount they were previously making.
She compared the current state of the tech sector to what she saw happen in Silicon Valley during the dot-com bubble burst in the early 2000s, a period of time when companies lost large sums of money and cut back on hiring.
"I saw talented software engineers lose their jobs, then sit around, drain their 401ks, and rack up debt before they were forced to take tech jobs that were half of what they were paid before," O'Donnell told BI when describing the dot-com bubble. "They really believed 'This is what I'm worth.'"
The career coach is now seeing salary dissatisfaction play out in her own career services. Some clients that come to her, she says, are tech workers looking for new jobs or are considering switching industries because she claims they just aren't happy with the salaries they're being offered.
As a result, O'Donnell says she has to manage expectations with her clients around what's a realistic amount of money to make today.
"I think what's frustrating these tech job seekers is that they're thinking I should make what I made, but that's not how it works anymore," she said.
Still, challenging economic conditions don't necessarily mean it's impossible for tech workers now to land a highly coveted, well-paying job. Doing so may simply require a different approach.
That's why O'Donnell is now teaching her clients how to market themselves by having them articulate the unique value they add. Doing so, she says, may help tech workers stand out from the pool of job applicants with the same technical skill sets.
That could lead to better opportunities with higher base pay.
"I do think the tech sector and tech employees are going through it right now, " she said. "They have to really recognize that to get more money, they're going to have to put more skin in the game."