In recent years, the main talking points in the IT sector have been both the shortage of experts as well as the salary level for software developers. In just over four years since its founding, Talented has met thousands of software developers and talked with virtually all of them about salaries. Most developers we met have worked in the most prestigious workplaces in Norway in the role of senior developer. At the same time on the other side of the table we have been talking to hundreds of IT employers, all the way from startups to listed companies. Discussions on both sides of the table keep us informed about salary level and aspirations of senior software developers, as well as how and on what grounds the salary is formed.
How is the salary determined?
Salary is a fee for the work done by the person and the value it generates to the company. In other words, salary is always justified.
Some of the most prestigious consulting houses in Norway includes TietoEvry, Arribatec AS, Sopra Steria, Cognite, Itera, Knowit, Bouvet. They all build digital business for their customers, receiving compensation for the hours spent on projects. Naturally consultants working on these projects are paid, and in that the consultant’s billing is central. The hourly rate for an experienced developer falls on both sides of 1200 NOK, the hourly rate for a specialist can be close to 1800 NOK.
For example, for a developer earning 50 000 NOK per month, a salary with expenses would mean a cost of approximately 65 000 NOK to the company (gross salary * 1.3, which roughly includes the costs associated with paying wages). Operational and administrative costs, from premises to sales, will be added to this, which will significantly increase costs. Especially in the above-mentioned companies, where the framework for work is top-notch, this part of the cost is also relatively high. However, as a consultant, you mainly work at you client’s premises, which can be frustrating when you still have to contribute to your employer’s luxuries and amusements at the office, where you rarely spend any time.
Product houses, i.e. companies that build and sell their own products, are in theory the only environment where high pay is possible. Successful product houses include Cognite, Neptune Software and Meltwater. In these developer-built products are distributed and sold throughout the world, so the financial benefits obtained can be really significant in some places. However, software developers’ salaries in these are mostly fixed, rather than tied to the success of the company’s business.
Salary level for software developers in Norway 2021
The gross monthly salary for experienced software developers is between 650 000 NOK and 850 000 NOK. At the top of the range tasks often involve responsibility either in terms of design or team management.
The above-average salary can also be obtained by software developers who have sales responsibility for customer service and the salary is partly based on performance. Performance-related salary refers to a model in which part of the salary is tied to the work carried out, for example the employee’s personal monthly billing from the customer. Projects sold at a higher hourly rate generate more money not only for the company, but also directly benefit the employee in the form higher monthly salary. If, on the other hand, the employee is away from work a lot or the client is not prepared to pay for their expertise, the performance-related salary will be reflected in a lower than average wage amount.
Examples of different performance-related salary models in Norwegian IT companies
Fixed NOK 35 000/month + 10% of personal billing
NOK 35 000 + NOK 950/h * 150h * 10% = NOK 49 250
NOK 35 000 + 1100/h * 150h * 10% = NOK 51 500
Fixed NOK 30 000/month + 10-20% of personal billing
NOK 30 000 + 950/h * 150h * 10% = NOK 44 250
NOK 30 000 + 1100/h * 150h * 20% = NOK 63 000
In performance-related salary, the employee’s experience and competence greatly affect the salary. Customers are usually willing to pay more for experienced software developers, and more experienced employees tend to have a higher share of billing.
Basic salary amounts in Norwegian IT companies
In the case of more traditional remuneration, the amount of money earned by the employee is directly correlated with the benefit generated for the company. More inexperienced software developers make less money and those with design responsibilities clearly earn more. Roughly speaking, we have identified the following wage hikes by experience level:
Junior Developer: 450.000 – 600.000 NOK
Developer: 550.000 – 700.000 NOK
Senior Developer: 650.000 – 850.000 NOK
Architect/Lead Developer: 700.000 – 950.000 NOK
Outside the capital area, the salary level is a few thousand lower.
There are exceptions, of course, and even in Norway you can find a few SuperCoders™ with monthly earnings of more than 100,000 NOK. However, if your current salary level falls well below these ranges, it may be appropriate to raise the issue with the company or find a new job.
In Norway, high tax rates effectively offset the benefits of higher cash wages. However, talking only about cash reward is misleading, especially when it comes to the most prestigious employers, as many of these companies offer their employees many different benefits with monetary value.
In our discussions with developers, instead of salary, we aim to focus on the dreams and career development aspirations of the developer, and thus find the most fun and comfortable job for the applicant. However, you can increase your own level of pay by, for example, learning new skills through a hobby, pursuing a senior or lead role, or changing companies.
What are your needs and criteria for your next career move? Tell us, and our Agents will find you a job or consulting gig of your dreams free of charge.
Talented was founded in 2016 in Finland by software developers to try to shake the global way of recruiting developers. Talented helps their developers find new jobs, consider their next career move, find projects and become entrepreneurs, for free. Join the Community!👇