UK salaries among the lowest in the world

New research reveals tech salaries in the UK are well behind other cities, making the sector's talent shortage all the more harder to bridge.

Software engineers around the world trail behind those in the US when it comes to remuneration. According to a new report from Hired, the maturity of the US tech market, coupled with the high demand for goods and services from IP-heavy businesses places US tech workers at a great advantage.

But with the UK’s growing tech skills shortage, low salaries in niche jobs could potentially make attracting tech talent even harder than it already is.

London only slightly ahead of France

The only places where tech workers make less than they do in London is in Singapore and Paris, according to the study. UK tech workers make 25 per cent less than those in San Francisco and 30 per cent less than those in New York. While these employees have seen their salaries remain flat over the last year, their purchasing power has actually decreased significantly (-17 per cent) because of the recent fluctuations in the pound.


Foreign talent propping UK tech sector up

27 per cent of tech workers who receive offers come from outside the UK, suggesting just how reliant the sector is on foreign talent. The need for the UK to attract global talent is further highlighted in the statistics that the average relocation offer is 28 per cent higher than that of local UK workers. This is significantly more than in New York, where the salary for local and relocated workers is the same, and in San Francisco where relocated workers are paid 10 per cent less.

With the uncertainties from Brexit around visas for foreign workers, this suggest the urgency for the UK to continue investing in developing of a pool of local talent.


Data scientists and product managers benefit the most

Over the past 12 months, the salaries of UK data scientists have grown 5 per cent, demonstrating how the role is becoming increasingly sought after, as data becomes a more valuable asset to businesses. They are now paid on par with software engineers, who have historically commanded the highest salaries in tech.

Product managers are now the highest paid roles in the UK, at £64,000. The role of the product manager is now 12 per cent higher than both software engineers and data scientists in the UK.

Gender bias rife in UK tech

In November, a separate report from hired revealed a striking pay disparity between genders in the tech sector. Across the UK, women are paid an average of 13.9 per cent less than their male counterparts. While the gap is lower in the technology sector, Hired data revealed that the median salary of women working in tech is 9 per cent less than the men they work alongside, equivalent to £5,000 a year in salary terms.

Among all the major tech hubs in the world, the pay gap is widest in the UK. The gap gets even wider for more technical roles and is widest in mid-sized companies.

The research also revealed that the sector’s bias is so pervasive that women in tech have skewed salary expectations. Hired data reveals that for software engineers at entry-level (less than two years of experience), men out-earn their female counterparts by 7 per cent. This rises to 10 per cent for men and women with between two to six years of experience, and ultimately reaching 31 per cent for individuals with more than six years’ experience.

This, in turn, has an impact on the salaries that women request. Women with less than six years of experience ask for roughly the same salary as their male counterparts; however, as they reach six or more years of experience, they ask for 18 per cent less. The fact that women lower their expectations over the course of their careers after receiving lower salaries than the men they work alongside underscores the importance of ensuring equal pay early on.

Praseeda Nair

Praseeda Nair

Praseeda was Editor for from 2016 to 2018.

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