With an unemployment rate of only 2.5%, according to new data from the U.S. Bureau of Labor Statistics, the technology industry’s unemployment rate has remained fairly steady. While unemployment isn’t shrinking, the technology industry still greatly outperforms the overall U.S. labor market, where the unemployment rate has dipped to 4.5%. The demand for knowledgeable, experienced technical professionals is growing in general but some cities are matching their demand with growing salaries while others are falling behind.
According to the latest Dice Salary Survey, San Diego’s technical professionals enjoyed the largest year-over-year salary increase of 4%. They were closely followed by St. Louis, Phoenix, and Boston at 3.1%, 3%, and 2.1% respectively. Additionally, Dallas saw an average salary growth of 2.1% year-over-year. While tech hubs like Silicon Valley and New York City continued to pay high average salaries, growing tech hubs offered salary gains that were unmatched by cities traditionally associated with the tech industry.
In fact, some metro areas saw notable declines in tech salaries. Silicon Valley’s average salary ticked downward a bit by .2% while technical salaries in Los Angeles decreased on average by a whopping 2.2%. In general, cities with room to grow that were aggressively attempting to become new tech hubs saw larger increases in average tech salaries while well-established tech hubs and larger cities didn’t match these numbers and, in some cases, fell behind their averages from the year before.
For technical professionals, these numbers are the extra push they might need to relocate to up-and-coming tech hubs like St. Louis and Dallas. The U.S. Bureau of Labor Statistics found that the average rate of voluntary quits for technology jobs at the beginning of 2017 was 617,500—an alarming increase from the first quarter of 2016 when it was just 584,000. This year is the year of technical professionals moving on in search of new and better opportunities and, if large tech hubs want to keep their talented technical professionals from fleeing to up-and-coming cities, they’ll need to start matching salary growth rates.
In order to have a lively tech community you must be able to attract and retain technical talent. While salary isn’t the only motivation for technical professionals to move on to bigger and better opportunities, it is a driving factor for many people. Especially when coupled with the fact that salaries are growing year-over-year in cities with lower costs of living and cities with higher-than-average costs of living such as Los Angeles and Silicon Valley are not only seeing no salary growth, they’re actually seeing salary decline for technical professionals.