IT CONTRACTOR RATE GUIDE. The New York Metro IT Market

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1 The New York Metro IT Market

2 Before diving into a discussion of current IT contractor rates, it s crucial to get a feel for the state of the current tech market in the New York region. While this is a very high level overview, it is nonetheless immediately clear why many companies are getting so competitive when it comes to hiring tech talent, and why so many tech professionals and companies alike are beginning to more fully embrace the growing trend towards contractbased employment. 2

3 A long-standing global powerhouse in a number of sectors, most notably finance, media, and commerce, the State of New York is clearly no stranger to the spotlight. New York City itself, serving as an anchor to the entire state, is the most populous city in the US, a bustling hub of activity and innovation. The state s unemployment rate has been dropping rapidly, landing most recently at 5.7%, the lowest since August of Zoom into the tech industry, and you can t fail to notice the astronomical job growth, exceeding that of Silicon Valley and growing an astonishing 40% in the last six years 2. It s little wonder why the city has been nicknamed Silicon Alley, in recognition of this growing sector. Of course, it s important to recognize that tech employment isn t limited to merely one industry; IT jobs are infused throughout most sectors. A recent study discussing NYC s growing tech ecosystem reports that as of 2014, there were 150,000+ tech jobs in non-tech industries and 58,000 in the tech sector itself 3. Overall, NYC s tech industry has helped generate over 500,000 jobs. And this tech boom is clearly following an upward trajectory. The city s mayor, Bill de Blasio, recently laid out his plan to continue strengthening the city s tech scene 4. The cornerstones of this plan are education, infrastructure, and innovation; a strategy that should succeed both in enlarging the tech talent pool as well as the number of tech-related jobs. 3

4 While de Blasio s efforts are focused on building a stronger talent base for the future of tech innovation, it doesn t necessarily solve today s challenge of finding enough qualified IT professionals to satisfy increasing demand. Employers searching for the best team members are fighting to gain a competitive edge in recruiting and retaining top talent. While this often includes an in-depth analysis of existing compensation structures and benefit offerings, many companies are also beginning to tune into the advantages of a contingent workforce. For contractors themselves, the benefits of both short- and long-term freelance work are many, including variety of work and higher pay. Consequently, there seems to be a growing movement towards this trend of workers. In fact, a recent study published statistics showing that a massive 34% of the US workforce now consists of freelancers 5. With these industry highlights and trends in mind, it is easier to approach the discussion of IT contractor rates. In the following pages, we ll present some data that we hope helps to provide a more stable sense of direction as you navigate the hiring process. 4

5 A Quick Overview of Different Contracting Scenarios The following contractor pay rate guide is based on median wages for highly skilled professionals with at least 7 years of experience. However, it s essential to bear in mind that these rates are affected by a number of factors. Beyond skills and experience level, perhaps the most important factor is the type of contract a given IT professional has chosen: W2, 1099, or Corp-to-Corp. W2 Contractors Similar to a regular W2 employee but on a contract basis, a W2 Contractor is on your payroll (or on the payroll of your staffing partner). This option mitigates IRS issues down the road, but also leaves you responsible for the costs of payroll, withholdings and taxes, as well as any mandatory healthcare coverage. Because these obligations are in your court, the pay rate of a W2 contractor will typically be less than 1099 or Corp-to-Corp contractors. 5

6 1099 Contractors An independent 1099 contractor is essentially the sole owner of an unincorporated business entity. In this scenario, the contractor is responsible for paying all income taxes and FICA taxes. This takes any payroll expenses entirely off your hands, though it also means that the pay rate will likely be higher. Because you re relying on the contractor to take care of all the tax obligations, you may be at a higher risk of an IRS audit down the road. Corp-to-Corp Contractors A Corp-to-Corp contractor has set up their own business corporation of which they are an employee. Like a 1099 contractor, they pay all their own taxes but in this scenario, you are better protected against any IRS risk. Because of the various costs involved in setting up an incorporated business, a Corp-to-Corp contactor s rate will likely be significantly higher. 6

7 Position Bill Rate Per Hour*.NET Web Developer $ Application and Infrastructure Security Architect $98.45 Application Architecture & Design Developer $ Application Developer $96.25 Business Analyst $77.00 C Level Programmer $ Cloud Based (Microsoft, Amazon, Aqua, Oracle) Administrator $ Cloud Computing Developer $ Customer Relationship Management (CRM) Developer $ Data Center Disaster Recovery Analyst $ Data Center Environment Management, Engineering and Support $88.00 Data Warehouse Manager $ Database Administrator $96.25 Database Architect $ Database Developer $85.79 DB2 Mainframe Database Administrator $90.25 Desktop Support Specialist $47.54 Desktop and Application Virtualization Administrator $71.50 Disaster Recovery Specialist $93.50 Drupal Developer/Architect $ Enterprise Security (AV, Encryption, DLP, PCI) Architect $ ERP and Vendor Product Development $79.36 GIS Support $96.25 Handhelds Application Developer $99.00 HP Quality Assurance Analyst $82.50 Hyperion Developer $

8 IT Risk and Compliance Auditor $88.00 IT Security Architect/Engineer $ IT Security Operations Specialist $90.75 ITIL Process Analyst $ IVR XML/VXML/JAVA Developer $93.50 Java Developer $95.25 Jr. Project Manager $74.25 Kronos Developer $74.25 Mainframe Operations System Programmer $87.36 Microsoft SharePoint Server Administrator $ Middleware/Service Oriented Architect $99.00 Mobile Applications Developer $ MS SQL Developer $ Network Administrator $63.25 Network Engineer $88.00 Network LAN/WAN/SAN Engineer $82.50 Network Security Architect $ Operations Support Analyst $52.25 Oracle DBA/PL-SQL Developer $96.25 Oracle Developer $96.25 Oracle Midrange Infrastructure DBA $98.25 Oracle Suite Administrator $93.50 PC Support Technician $41.25 PC/LAN Support Analyst (Hardware and/ or Software) $60.50 PeopleSoft Integrator/Support Analyst $ QA Analyst/Engineer $

9 Quality Assurance Analyst $79.75 Real-Time Embedded Software Specialist $85.25 Ruby Developer $ Server Operations Programmer $68.75 Software Developer $71.50 Sr. Project Manager $ System Analyst & Administrator $88.00 Technical Writer $74.25 Telecom Technician/Analyst $63.25 Transportation Services IT Support $79.75 Web Developer $91.95 Windows/VMWare Administrator $93.50 Wireless Support Specialist $90.75 *Experienced professionals with a minimum of 7 years of experience

10 ABOUT DONNELLY & MOORE At Donnelly & Moore we maximize the potential of human capital and drive business growth by connecting experienced, highly credentialed IT professionals with demanding firms across a wide range of industries. Since 1997 our strategic workforce solutions have helped Fortune 100 companies execute critical projects and strengthen existing teams. With unparalleled access to talented IT professionals and a customized, process-based approach to placing highly qualified individuals on each project our clients undertake, we generate results that speak for themselves. Our talent pool consists of the country s top information technology professionals. We attract, assess, develop and place coding experts, IT architecture gurus, Web developers and hardware specialists with clients in finance, utility services, entertainment, infrastructure, government and other sectors. Our clients rely on us to enhance their competitiveness by filling key roles with talented professionals who uphold their culture and internalize their objectives. Our unmatched capability to attract and retain professionals with critical expertise enhances workforce productivity, reduces waste and guarantees the quality of completed work. Donnelly & Moore 14 Wall Street, 20th Floor New York, NY Looking for IT Contractors? Phone: (212)

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