The Covid-19 pandemic has changed every part of our lives and now we are living in a completely different reality. The pandemic has also changed how we work, and remote work has become common for many of us. Moving forward, all these events could have an impact on things like our salaries. Read below to learn more about how the pandemic could potentially change tech salaries.
More Competition
One of the first things that will change after the Covid-19 pandemic is that remote work will become more common throughout the industry. With that, companies will have access to a wider talent pool of software engineers, web designers, or any other tech professional from anywhere in the world.
This will translate into more competition for salaries because workers from other countries or even other US cities could potentially accept lower salaries. Right now, 55 percent of tech workers say they won’t accept a pay cut if working from home becomes a permanent thing. That number may change when their employers start hiring professionals who are willing to negotiate.
Also, having a wider talent pool will allow employers to diversify their talent. This increased in competition can put the current workers at risk of being replaced if they do not want to accept certain terms.
Long-term Stagnation
Long-term stagnation of salaries is another threat in the new Covid-19 era. Tech salaries have slowly increased each year over the last decade. That may change with the pandemic. Not only because some companies are considering adjusting salaries depending on location but because employees don’t feel comfortable asking for a raise.
In a survey, 53 percent of employees said they would be less likely to discuss a salary increase during the pandemic which may result in salaries entering a plateau moving forward. Not all companies are expected to follow this pattern; we will have to wait and see what happens.
Salary Adjustment
What is most likely to happen now that remote work is becoming permanent, is that companies will start offering salary adjustments to employees that decide to work from home. This means they will calculate their worker’s salaries according to the cost of living in the city or country they work from.
Big tech companies like Microsoft or Facebook are thinking of implementing localized compensation for the post-Covid world. GitLab is an all-remote company with workers from all over the world. It already applies this concept to assign compensations according to location. But this shouldn’t be a big issue for many tech employees.
Let’s say you are a software engineer working in New York. You relocated to a little town in Arkansas, closer to your family. Even after a pay cut, you will probably have more money left than before because the cost of living in Arkansas is much lower than in New York.
Office-Remote Hybrid Possibility
A real possibility is that tech companies will start using an office-remote work modality where employees will be able to work from home some days of the week. This will give employees the chance of a more flexible schedule and environment while still eliminating the risk of localized compensation. They will still be going to the office at least once every week.
According to Hired’s salary report, only 7 percent of tech employees want to go back to the office full-time. This hybrid could be the future of work after the pandemic.
Is it Still Worth it to Learn a Tech Skill?
Tech professionals are still some of the best-paid in the country. Even if companies start implementing localized compensation, you will probably enjoy a well-paid job. You will also have all the perks and benefits that come with working in a tech company.
You can learn a tech skill in less than a year with a coding bootcamp and for less than half the price of a bachelor’s degree. You can check out Career Karma’s website to learn more about coding bootcamps to see if that could be a good option for you.
In Summary
The increase in remote working is opening the doors to a wider and more diverse talent pool than ever before. This will increase competition and could lead to long-term stagnation of salaries. Also, companies are thinking of giving localized compensation to adjust salaries according to each worker’s location. What we will start seeing soon is a possible hybrid modality that combines working from home with going to the office a couple of times a week.
