Tech Industry Salaries Are Failing to Keep Up With Inflation

Inflation has been a wrecking ball to the global economy, and it seems that this is making the salaries of even the most well paid of individuals seem insufficient with all things having been considered and taken into account. The tech industry is well known for providing some of the highest pay rates in the world, but in spite of the fact that this is the case employees in that sector are unhappy due to their pay increases falling well short of the rate of inflation.

Tech salaries in the US rose by 3.2% this year to reach $159,000, but that isn’t quite enough to cover the increased cost of living caused by inflation. With all of that having been said and now out of the way, it is important to note that many employees are saying that they might quit in the next six months if they are not given the salary increases that they are asking for.

This is creating an interesting trend that involves a shift to remote work. Remote work allows employees to save money on commuting, and ironically this popularity is resulting in remote jobs paying more than local ones. In Chicago, the gap between remote work and local work is as high as 6.2%. Tech employees are clearly aware that remote work allows them to get jobs on the other side of the world without having to move, and this is giving them a competitive edge in the labor market.

This is also resulting in workers going to cities where the pay rate is higher. Philadelphian workers saw their salaries increase by 11.9%, and that could result in a paradigm shift since the tech industry will always go where the workers are.

The tech industry has long faced problems with drying up hiring pools, and inflation is making matters worse than might have been the case otherwise. We will have to wait and see what kind of an impact this might have on the industry in general, but the fact remains that employees are not willing to stick with employers who don’t pay them well enough.

H/T: Hired report pdf.

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