IT staff expecting bigger salaries and smaller bonuses

Pay for technologists in investment banks remained stubbornly static throughout 2009, but with more significant levels of recruitment expected this year - combined with a greater emphasis on increasing fixed salaries in lieu of big bonuses - this is set to change.

The latest quarterly investment banking technology salary survey by recruiter The JM Group suggests that pay didn't move throughout 2009.

Still, this pay freeze looks likely to defrost. As bonus season approaches, speculation is mounting that no only are decent payouts on the table, but that investment banks are likely to increase base salaries.

Paul Bennie, director of financial IT headhunters Bennie MacLean, says: "We're expecting bonuses of around 30-50% for mid-ranking technologists in investment banks. However, a lot of firms are placing greater emphasis on raising base pay rather than paying large bonuses."

A recent example of this is Deutsche Bank, which said yesterday that it was increasing fixed salaries and shrinking variable compensation to ensure pay "remains competitive".

Simon Walker, director of recruiters Project Partners, says: "I think we're going to see huge differentials between the banks. On one hand, government stakes and shareholder pressure will restrict bonus payouts, while other firms will want to reward staff after a good year. We'd therefore expect more movement than usual after bonus season."

Fixed income, FX and equity derivatives remain key areas of demand, says JM Group and its anticipating salary increases in these areas.

"There's a major drive to mop up any candidates with the right development skills," adds Julie-Anne Brooks, director, head of the JM Group. "The new year promises to be an exciting one for candidates with core development skills and we expect to see salaries rise as a result."

Investment banking IT salaries (Q4 2009):

Source: JM Group