Tech industry workers in the Phoenix metro saw the fastest salary growth in the nation in 2022 and had the eighth-highest average salary among all U.S. tech hubs, according to a new report from Dice.
The 2023 Dice Tech Salary Report from the industry employment platform found that salaries were up 26.2% in the Valley in 2022 over 2021. That’s significantly ahead of Tampa’s 19%, which was the second-fastest salary growth. It also vastly surpassed the national average increase of 2.3%.
In Phoenix, the average tech salary is $120,731, higher than the national average tech salary of $111,348.
The report was based on survey data from New York-based employment agency DHI Group Inc.
Arizona as a whole lead all states for the speed of growth in tech salaries, up 20% since 2021. The states closest to that was Oregon, where salaries rose 12.3%, and Connecticut, where they were up 11.2%. Salaries in tech powerhouse California, by contrast, were up by only 2.6%. As far as salaries themselves, Arizona’s statewide average of $116,898 was ninth highest in the nation.
The pay growth that the Valley has seen was helped in part by a trend of workers moving away from traditional tech hubs like California to the benefit of non-traditional hubs like Arizona and elsewhere.
“High tech salaries are certainly no longer limited to the coasts, as all of the top 25 cities for tech compensation boast an average salary over $100,000, and these locations are spread throughout the country,” the Dice report said. “The average growth in the top 25, however, was 4%, given that there were a few declines and many modest year-over-year increases.”
All that said, however, traditional tech hubs still had the highest average salaries. In Silicon Valley, where salaries were up 5.1% in 2022, the average was $144,962 to lead the nation. After that were Boston ($130,399, up 9%) and Seattle ($129,456, up 7.6%).
Which industries, careers saw the biggest increases
When broken down by industry, tech salaries rose the most between 2021 and 2022 in the hospitality and travel industry (up 19%), the consumer products industry (up 14.4%), the manufacturing industry (11.9%) and the internet services industry (10.5%). Growth was less than 10% in all other sectors.
Dice said the pay rise in hospitality/travel could be attributed in part to a return of investment in tech after budget constraints that started in early 2020.
Tech workers in IT management, such as CEOs, CIOs, CTOs and other executives, had the largest salaries in 2022, averaging $164,814, which was 8.4% higher than in 2021. The next highest salaries were for solutions architects ($155,934), principal software engineers ($153,288) and systems architects ($151,364).
Those careers benefited from having highly specialized skills, the report said, as did cybersecurity engineers, cloud architects and program analysts and managers.
“It’s easy to see why these roles demand such pay premiums in addition to other perks and benefits,” the report said. “It takes many years of learning and experience to effectively plot a company’s software strategy or architect its cloud setup.”
As far as salary growth for occupations, product managers saw the highest jump at 15.6%. DevOps engineers were next at 14.1%, program analysts and managers were up 12.9% and MIS managers were up 10.8%.
The report found that some of the most valuable skills include those involving data, cloud and virtualization abilities such as MapReduce, Elasticsearch, Apache Kafka and Teradata, each of which were among those whose users commanded salaries averaging more than $140,000.
Unemployment for technology professionals across all sectors in the U.S. fell to 1.5% in January, as "demand for tech talent remained historically strong throughout the year, especially in more established industries like finance and banking, healthcare, consulting and aerospace and defense," according to the report.
