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IT Startup Salary Hotspots: Top Locations for IT Startup Jobs

If you’re a whiz at writing code or a super-smart network systems analyst, which town is a hotbed for startup companies offering the most job opportunities and bucks for your talents? Online salary database and career site PayScale.com has explored its data on technology jobs to answer this question and come up with a helpful list of cities to consider.

PayScale focused on salary and benefits information for Information Technology (IT) startup jobs at IT startup companies in the following tech-heavy towns: Austin; Boston; Washington, DC; Raleigh-Durham; Salt Lake City; San Francisco; and Seattle. PayScale ranked these towns based upon the following process:

1. Determine the ratio of IT workers (those with the most common IT startup jobs) at IT startup companies relative to all workers in a city.

2. Calculate the typical pay of IT workers at IT startup companies to see if some cities have above-average pay for IT startup jobs.

3. Come up with a score that takes into account both the relative presence of IT startup jobs and the relative median pay of IT startup workers in the city.

PayScale also looked at some not-so-hot metros for startup jobs to see how they compared. These towns were Atlanta, Chicago, Dallas, New York and Philadelphia.

IT Startup Salary Hotspots

Who came in first as a high-tech hotspot for startup jobs? San Francisco. This is hardly a surprise since the city by the Bay is a long-time source of cutting edge technologies and new startup companies.

Below is a table ranking the metros according to their IT startup salary hotspot score:

IT Startup
Hotspot Rank
Metro IT Startup
Jobs Ratio
IT Startup Jobs Median Pay Median
Pay
Ratio
IT Startup
Hotspot Score
1 San Francisco 2.61 $87,100 1.35 3.53
2 Austin 2.24 $67,400 1.05 2.35
3 Seattle 2.06 $71,400 1.11 2.29
4 Salt Lake City 2.03 $64,300 1.00 2.03
5 Boston 1.55 $72,700 1.13 1.76
6 Washington, DC 1.39 $74,900 1.16 1.62
7 Raleigh-Durham 1.53 $65,300 1.02 1.55
8 Atlanta 0.99 $67,900 1.06 1.04
  United States 1.00 $64,300 1.00 1.00
9 Chicago 0.97 $65,900 1.02 0.99
10 New York City 0.90 $70,600 1.10 0.99
11 Philadelphia 1.02 $61,400 0.95 0.97
12 Dallas 0.85 $65,400 1.02 0.86

The chart shows that San Francisco is the IT startup jobs hotspot both because it employs more than double the national average of IT startup workers and because it offers pay over a third higher than the national average. The same is true for Seattle and Boston. They offer a relatively high level of IT startup jobs and relatively high median pay for startup jobs.

By comparison, some tech-friendly cities have higher numbers of IT startup jobs, but offer lower-than-average pay. For example, Austin is an IT startup hotspot due its high ratio of startup jobs, but for pay it only ranks in the middle of PayScale’s list (7 out of 12). The same could be said for Salt Lake City, except pay there is truly near the bottom (11 out of 12).

DC and New York offer different perks and downsides. These towns have mediocre ranks for IT startup job ratios, but pay relatively well (2 out of 12 and 5 out of 12, respectively).

Therefore, pay alone does not necessarily cause a metro to be a hotspot for IT workers at startups. It is possible for the number of startup jobs to be high, while the pay is average (Austin, Salt Lake City, and Raleigh-Durham). Similarly, it is possible for the pay to be high, but the number of startup jobs available to be less (DC, New York, and Atlanta).

Questions to Ask When Working for a Startup

So, should tech workers run to towns like Seattle, San Francisco and Austin right away for a high-paid, easy-to-snag startup job? Not necessarily. There are a few questions to ask when working for a startup or considering a switch that means a move to a new city.

1. Consider cost of living in the new city compared to your current city. Will your paycheck go further or is that attractive salary really a pay cut when you factor in the new city’s added expenses?

2. Are you willing to take a pay cut to work at a particular company or in a certain town?

3. Are there other compensation factors to consider beyond your base salary, like stock options, where the payout can, one day, pay off, such as for early Microsoft, Google, and Amazon employees? And, are you willing to take that risk?

4. Do you believe enough in the company’s product that you’ll earn less to make it succeed?


More from PayScale:

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