Banks today must focus on improving employee engagement, investing in training, and providing interesting and flexible work environments if they expect to recruit and retain management and staff. The 1,184 banking and securities IT staff and managers who responded to the InformationWeek 2013 U.S. IT Salary Survey affirmed these trends.
"The way to engage technology folks is to give them something interesting to do, support to do it, IT training if they need it and a coach to help them learn new things," says Judy Pennington, director of human capital at Deloitte Consulting.
Pennington advises financial firms to offer flexible workplace options in order to better engage employees. "The days of working 24/7 are gone," she says. "We can work our fingers to the bone for special projects, but we all need work-life balance. Engagement is about learning something new, doing cool work and knowing that they're valued for what they bring to the table."
"Money is good, but money isn't the only reason people come to a job," says Steve Rubinow, CIO of the marketplaces division at Thomson Reuters. "Employees want to work in an environment where they'll be challenged, where they feel like they're accomplishing something important."
While employee engagement isn't all about money, it's imperative for financial firms to offer competitive salaries. Compensation will always be an issue, but it's generally not the main reason someone takes -- or leaves -- a job.
This year's survey reveals that base salaries for staffers and managers are increasing over 2012 levels, although the median increase is a scant 0.9% for staff and 1.7% for managers. The median percentage of change in total cash compensation, including bonuses and other direct cash payments, rose 1.1% for staff and 2.3% for managers.
After seeing base salaries remain flat, at a median of $90,000, from 2011 to 2012, staffers experienced a bump in 2013 to $94,000. Management saw a similar lift after suffering a drop from 2011 to 2012: Median base salary rose from $117,000 in 2012 to $120,000 for 2013. Total compensation also improved, with staffers bringing home $101,000 (compared with $99,000 last year) and managers tallying $134,000 (vs. $130,000 in 2012).
Most managers (89%) and the majority of staff (75%) expect a bonus this year. Bonuses are most often tied to personal, corporate and division performance, as well as completing project milestones and company profit sharing.
In some financial services segments, salaries are relatively nominal because they can be supplemented with big bonuses, says Rubinow; however, "prospective employees on both the staff and management levels want a higher salary because bonuses aren't as dependable as they used to be," he says.
A gender gap in base pay persists on both the IT staff and management levels, although survey results show that this gap is narrowing. Female managers, however, receive less in the way of total compensation than their male counterparts, with women in managerial positions earning about 20% less in total than men in the same level jobs. One survey respondent, a female VP of a large financial services firm, expresses her dissatisfaction: "I have two peers, both male. They both earn about $25,000 more annually, which is very frustrating."
Pay may not be everything, but it's important, says Mike Barker, senior VP of executive search firm Experis North America. "Employees experienced salary cutbacks starting in 2008, and there hasn't been much movement in salaries," Barker says. "In some cases, they're catching up. But at the end of the day, in addition to competitive pay, IT folks are also looking for good projects, cool work, positive life-work flexibility and experiences that will enhance their resumés."
The good news is that a majority of staff and managers are satisfied with their total compensation packages. Overall, 61% of staff and 59% of managers say they're either very satisfied or satisfied with their compensation packages. Fewer than 20% from each group say they're dissatisfied or very dissatisfied with compensation.
Evolving Skill Sets
IT roles are transforming as needs change and technology evolves. For financial firms, an ideal IT employee must have a combination of top-notch skills and business savvy, says Thomson Reuters' Rubinow. "Technologists need to be adept in one or more technologies and be above average. Financial organizations want people who are sensitive to business needs and have an appreciation for why they're doing things and how they benefit the business. They want technologists who can provide innovative ideas and collaborate with and act as a partner to the business. And, finally, financial firms need technologists who are aware of and sensitive to the costs of their activities and the impact on the bottom line."
Respondents to InformationWeek's survey tend to agree that the combination of business and IT skills is critical. "The line between what's IT and what's business will get more blurred as the use of big data expands," says one. "Those who can continue to straddle both worlds will come out ahead in terms of salary but will find job opportunities scarce."
It's always a challenge to find good people, Rubinow says. "No matter how soft the labor market is, no one seems to be able to find enough talented people," he explains.
Jon Beyman, managing director of global operations and IT for the institutional clients group at Citi, says his group is hiring in places where there is a specific need. "In the institutional world these days, there's a big regulatory agenda, so we look for particular skill sets around domain expertise that would help us in some of our efforts when it relates to Dodd-Frank or Basel, for instance," Beyman says. "And in the past few years, anyone with domain expertise around information security has been in high demand."
A healthy number of respondents say their work involves formal responsibilities outside of IT -- 29% of staff and 44% of managers. IT staff most often had research and development, business development and financial duties, while managers most often had those same responsibilities as well as responsibilities in operations, supply chain and manufacturing. Fifty-four percent of staff and 73% of managers spend time with peers in a business unit outside IT.
Technology evolves so rapidly that it's imperative for technologists to stay on top of the latest trends. While survey findings indicate that banks and securities organizations are investing in their workforces -- half of staff and 61% of managers attended company-paid training last year -- some respondents say it's just not enough.
The economy clearly affects company-paid training, as well as employee engagement. "I have received employer-paid IT training in the past 12 months, but it is the first time since 1997 that an employer has thought training was necessary or valuable in my case," says one respondent. "I'm normally expected to 'figure it out' with any new technology or vendor by using any means that doesn't cost the company money. In my experience working for financial services companies, IT is viewed as a liability to be minimized, not as the engine that enables all of the processes that the company uses daily to serve customers and make money."
Training is often quick to go when budgets are tight. "I would say that at one time or other, everyone skimps on training, because it's considered low-hanging fruit when they need to make cutbacks," Experis' Barker says. "Three out of four managers say they're willing to pay for IT training and they do, but they provide training only on skills that affect the most visible or highest areas of payback projects. On the other hand, IT professionals have to invest time in their own certification and learning to augment what they're getting from their employers."
When it comes to training, some financial organizations aren't thinking ahead, Barker says. "Employers need to be thinking and working ahead to what their talent needs will be in the future," he says. "If you don't know your needs until you need them, you'll be behind the eight ball."
According to survey respondents, both staff and managers still look at technology-specific training and certification courses as most helpful in developing their careers, although both groups also value project management and business skills training. Managers also find training in people management skills valuable.