SAP consultants stay top of the pay scales

Consultancy rates are dropping: it's not great news for employees but it should be a tonic to companies looking to hire staff for ERP and other IT-related projects

SAP consultants continue to command the highest salaries, despite a downturn in the Enterprise Resource Planning (ERP) market that has seen salaries of ERP consultants, project managers and programmers fall across the board.

Research published this week by IT services company Millennium shows that although full-time IT posts have suffered, with a drop in salaries and the role of IT director being diminished as companies lose faith in technology, contract workers have fared far worse. Average contractor pay dropped 30 percent during 2003 -- on top of a 22 percent fall during 2002.

The survey, of 2,000 organisations across Europe, may not be great news for employees but it should be a tonic to companies looking to staff up for ERP and other IT-related projects. "It remains a buyer's market for consultancy and one extremely unlikely to return to the heady over-inflated daily rates of the Y2K projects and dot-com boom times," wrote report author Philip Keet, who is the founder and managing director of Millennium.

Staff retention is also less of a problem than it used to be. "Permanent salaries have remained static throughout 2003, due to complete market stagnation," wrote Keet. "Long gone are the days of moving jobs every 18 months. The timeline now is closer to four years."

The is no significant upturn yet in implementation of ERP systems, according to the report, The European ERP Salary and Fee Survey, but new system planning in banking, retail, public sector and other organisations points to a definite increase in activity towards the end of 2003 and during 2004.

SAP's increased market share, which according to analyst firm Gartner rose from 24.7 percent in 2001 to 25.1 percent last year, has seen SAP skills remain in highest demand, and therefore continue to command the highest salaries. "In general, however, the salaries of those with ERP skills have not held up as well as salaries of experts in mid-range solutions such as CODA and SunSystems," wrote Keet. "This partly because ERP staff have suffered hard at the hands of cost cutters because of their relatively high salaries."

A drop in senior level salaries has smoothed out differences between vendors, with mid-range consultants commanding similar salaries to consultants specialising in top-end products. UK IT directors with SAP expertise can command salaries up to £90,000, as can IT directors with Oracle Financials, PeopleSoft, JD Edwards and Baan skill sets.

SunSystems tops out at £80,000 as does CODA, while Navision, Agresso and Microsoft Great Plains consultants all command the same £90,000 annual figure as the top-end product specialists. These figures are reflected at every job level, with project managers commanding salaries of £50,000 to £60,000 in every vendor category, except for Agresso, where salaries tend to be slightly lower.

Programmers meanwhile can expect to receive £30,000 to £40,000 for expertise in every ERP application, except SAP and Microsoft Great Plains, which adds £10,000.

In the beleaguered contract sector, the UK daily rate for a highly trained SAP configuration consultant has dropped from £750 to closer to £500. Programmers meanwhile can command salaries of just £400 a day "and even at that level there remains an extremely low level of work available."

In the ERP market, there is a glut of programmers resulting from the huge surge in demand ahead of the Y2K bug's appearance. That level of demand will not be repeated and large numbers of these personnel must face up to the need to retrain and look for jobs elsewhere, concluded the report.