The Level of Salary Increase for IT Professionals in Indonesia Exceeds Management Positions

The rapid growth of the technology industry – marked by the proliferation of startups – has led to an increasing need for IT professionals, from UX designers to SEO experts. Unfortunately, the availability of manpower with such qualifications is currently very limited. As with economic principles, the more limited the supply, the higher the price of goods. In this case, the principle applies to salary standards.

Jason Lambuda, CEO of Berrybenka, explained that the increasing need for startups for professionals was triggered by their desire to expand their business along with the large funds they managed to get. “Usually startups prefer experienced professionals rather than having to train newbie. However, getting experienced personnel is very difficult because their number is very limited,” he said.

The need for IT experts is even more obvious among companies that need systems that work non-stop.

Budi Gandasoebrata, GM Veritrans Indonesia, said that e-commerce services do need a non-stop system considering the level of non-stop demand for 24 hours from local, regional and international customers. According to him, the availability of IT experts in infrastructure and security technology is very crucial for the sustainability of the system.

“We really value app developers. And as our demand increases, our award level also gets higher,” said Gandasoebrata.

Indonesia is without a doubt increasingly being considered as an investment zone for companies. The country rose 4 places to 34th place out of 144 countries listed in the 2014-2015 edition of the Global Competitive Index (GCI) issued by the World Ecocomic Forum. In the previous year's edition, Indonesia was in 38th position.

Furthermore, Nadiem Makarim, CEO of Go-Jek, added that the rate of increase in salaries of IT experts now reaches 30-40 percent per year, far exceeding the rate of increase in salaries of other experts which is "only" around 20 percent. “There are even some budding IT experts who earn the equivalent of a senior management staff,” he notes.

Lambuda even said that the salary increase could reach 50 percent per year. The inflation rate and the increase in the minimum standard of wages certainly play a role in this.

The increase in the salary level can even occur from the start of the employees working. For example, the starting salary of a marketing staff now reaches IDR 4 million from the previous IDR 3 million. "With the same calculation, a manager can now pocket Rp 20 million a month from what was previously around Rp 15 million per month," he added.

However, Makarim believes that the rate of increase in Indonesia is still fairly reasonable. "Compared to what happened in Malaysia or Singapore, the rate of increase here is not very high," he said.

The rate of increase that occurred in Malaysia and Singapore is a reflection of the soaring position of the two countries in the GCI. In the index, Singapore is in second place while Malaysia is in 20th position.

Lambuda added that the salary increase had more of an impact on the IT experts themselves. In this case, they may move from one startup to another in order to get a bigger salary.

“The startup world is relatively small, it's not that nice to know that someone is moving from one place to another. Startup owners are smart people; they can tell when someone is working without passion or just after money,” he said. Furthermore, he said that startups should not only offer money to attract IT experts.

“Those who work in startups generally don't prioritize money, but rather experience and opportunities to learn more. They could have left if they had greater learning opportunities elsewhere,” he said.

"So, startups must also realize that employees are not servants, but people who want to increase their knowledge," he concluded.