The Four Hundred--Some Salaries at OS/400 Shops Grow, Others Decline

If you're looking for a raise out there in OS/400 Land, it looks like you might do better than the 2.2 percent cost of living increase that is gauged to the U.S. Consumer Price Index, provided that you are not a PC support technician, system operator, or junior programmer. Salaries at OS/400 shops, says Nate Viall of the recruiting and salary analysis firm that bears his name, are bifurcating, and this has important implications for the OS/400 ecosystem.

Viall tracks salaries for managers and programmers for various titles, geographies, education levels, and experience. In the middle of 2003, the average salary for managers across all of these factors was up 5.8 percent, to $87,700, from a year ago. Vice presidents of information systems and chief information officers at OS/400 shops saw their salaries rise to $134,400, and directors of information systems averaged $104,400. Viall said that responses to his salary surveys were unusually high for top-end managers, and when he adjusted his numbers for a more typical mix of titles (including more DP managers and supervisors, who make a lot less money), the average salary increases across all managers was more like 4.1 percent.

In the most recent data, Viall found that salaries for IT directors were up by only a slim 1.3 percent, and technical support managers only saw a 2.6 percent increase compared with their total compensation a year earlier. Managers in rural areas saw decent increases of 6.3 percent on average, but their average salary of $77,600 was $26,100 below that of managers in major metropolitan areas, who pocketed $103,700 on average. Female iSeries managers might be thinner in the ranks than male managers, but they are seeing an average of 8.7 percent pay increases, which is heartening to see.

Average salaries for all programmers, across all factors (like geography, title, experience), were up 3.8 percent, to $59,700. Among programmers with nine of more years of experience--which is an increasing portion of the OS/400 programming pool--the average salary was $65,400, and among the top fifth of these senior programmers, salaries increased to $86,800. What this means is that a director of IS may be barely earning more than a hardcore, experienced programmer. That has to be satisfying to at least (and probably no more than) one of them. Most programmers saw their compensation increase by 2 to 4 percent in the past year, and as you might expect, given this poor economy and the intense backlog of work, those programmers with the most experience are seeing the biggest increases. The pay being offered to junior programmers, with less than three years of experience, continues to decline, down 4 to 4.5 percent in different geographies. PC support and system operators are getting token raises that are less than the index. As with managers, programmers in rural areas are seeing their pay rise by more than those in urban areas, but the average rural programmer makes $54,800, compared with the average urban programmer, who makes $69,700. Viall said that senior consultants were able to see 2.8 percent growth in their compensation, but that the absolute number of OS/400 consultants was shrinking.

In March, when Viall reported OS/400 salaries for the end of 2002, manager salaries were up 5.4 percent, to $85,400. Technical staff salaries--including those for analysts, programmers, support techs, and administrators--are up 4.4 percent from the end of 2001, rising to $58,900 from $56,400. At the time, it looked like the elimination of a small number of programmers at companies was contributing to the rise in average salaries, and this could still be happening now. (When you have 10 programmers, and you fire the least-experienced and least-paid programmer, the average salary across the other nine goes up, even if their individual salaries do not.)

In 2003, Viall says, very few companies are saying that they have frozen salaries for their IT staff. And even if they did, it is unlikely that employees would be eager to try to get a new job. Viall says that 85 percent of the people surveyed in his latest salary data have been with their current company for two or more years.

Another interesting observation: Viall says that workers returning to the job market after a hiatus (for whatever reason, being that they were laid off or took a leave) are getting and accepting lower pay for entry jobs than actual newbie recruits, who are often being paid an incentive to join the OS/400 fold. IT managers polled by Viall say that they expect to give pay increases ranging from 1.5 to 3.5 percent in 2004, but they also say they may give other incentives and bonuses on top of this, presumably if the economy perks up. The dearth of new programmers is creating what will be a big problem a few years from now, when a large number of senior programmers head out to a well-deserved rest away from OS/400, in retirement. If companies do not train new programmers today, newbies won't be seasoned when they are needed, when the OS/400 boomers, who entered the market in the late 1980s and mid-1990s as the OS/400 platform took off, decide to go fishing, to spend more time with their grandkids, or to blow all their dough in Las Vegas or Atlantic City.

If you want to get the latest full salary report and a free salary analysis, go to www.nateviall.com. Individual state or geographic salary reports, which range in size from 8 to 70 pages, are available from Nate Viall & Associates, starting at $24 each. An annual OS/400 salary subscription service is available for $233.