META Group's 1998 Staffing and Compensation Study Reveals Labor Shortage Impact on IT Hiring:
Technologists Now Command Higher Salaries Than Non-Technical Staff

STAMFORD, CT--(BUSINESS WIRE)--March 20, 1998--

META Group, Inc. (NASDAQ: METG) today announced the availability of its 1998 IT Staffing and Compensation Guide, the industry's most comprehensive source of accurate market-based compensation data and best practices for managing a diverse range of IT professionals, including Internet and intranet technology specialists, enterprise project managers, and Y2K directors.

The first of its kind for 1998, the guide reveals the significant impact that the IT labor shortage has had on hiring practices in 1997. According to META Group, technologists in general are now commanding higher salaries than non-technical personnel. Of those companies that META Group surveyed, nearly 50% say salaries are higher for jobs within IT than for comparable non-technical positions. Some 33% of those respondents indicate that these IT salaries are 11% to 20% higher. In addition, 61% of surveyed companies now include skill premiums as part of base salary, a 22% increase over 1996.

"The labor shortage has put companies into a bidding war for talent," said Kerriann Vogel, META Group's senior research analyst, IT human capital management. "By including skill premiums in base salaries, companies are locked into paying the premiums even when a skill is no longer 'hot.' Companies should instead consider skill incentives based on market demand and separate from base salaries, along with individual performance bonuses." The survey also found that the practice of moving employees with business backgrounds into certain IT positions, such as business technology consultants and web content managers, continues to increase.

Survey Scope and Methodology

The 1998 IT Staffing and Compensation Guide contains up-to-date detailed job descriptions and market-based salary and bonus data for 96 positions essential to building business-integrated IT organizations, more than twice the positions covered in 1997. New titles include director of enterprise architecture, e-commerce project manager, system security administrator, and e-mail/Notes project manager for servers and networks.

The guide covers 23 metropolitan areas and is based on targeted, multi-sourced research that draws from META Group's 1,400 clients, as well as from privately-commissioned single- and multi-client salary studies which include more than 300 companies with $100 million or more in revenues.

"Much of the salary and staffing information available to IT management through human resources departments does not reflect today's highly competitive market and focuses on traditional IT positions that have been defined for years," said Joe Gottlieb, META Group's director of cross-functional research. "This report is designed to help IT managers struggling with managing, recruiting, and retaining resources in the tightest, fastest changing job market we've ever seen."

Report Findings

As the IT labor shortage and Y2K projects continue to drain company resources, many organizations have had to pull back on their education and training offerings. According to META Group, only 43% of companies surveyed provided tuition reimbursement in 1997, down from 86% in 1996. Additionally, only 48% provided professional seminars or formal in-house training, down from 63% the previous year.

"Training dollars are down for two reasons," said Kerriann Vogel. "In some cases, training budgets are being moved to expensive projects such as Y2K and ERM implementation. And, we're also finding that employers are opting not to pay for on-going training because they're having to pay higher base salaries."

The guide also found that:

• As expected, flexibility in the workplace continues to increase in importance. Ninety percent of surveyed companies provide flexible work hours, up from 77%, and the percentage allowing telecommuting has risen to 60%, up from 55%.
• More companies are paying bonuses and incentives for IT professionals -- 77% this year as compared to 30% last year. However, rather than tying bonuses to individual contributions or team success, as META Group recommends, most companies base incentives on overall corporate performance.

In addition to compensation data and job descriptions, The 1998 IT Staffing and Compensation Guide includes 50 pages of analysis focused on three primary areas related to the management of IT human capital: resource management for effective retention, development and deployment of personnel; performance management, encompassing measurement techniques and compensation practices; and recruiting, including non-traditional tactics for hard-to-find professionals. "This survey shows that companies must work harder than ever to create an environment that both attracts talent and promotes retention," said Joe Gottlieb. "This includes developing more effective management communications, more clearly assigned roles, and better team incentives, as well as providing a more stimulating work environment."

Pricing and Availability

More information about the guide, which costs $5,500, can be obtained by contacting META Group at 800-945-META. Headquartered in Stamford, CT, META Group, Inc. is an independent market assessment company providing research, analysis, and advisory services regarding developments and trends in information technology. META Group currently serves more than 1,400 clients worldwide. Additional information about META Group is available on the World Wide Web at http://www.metagroup.com.

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Dr. Patricia Neptune or Pete Ward
Neptune Group International Inc.
203-221-2820

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