If big data is the key to propelling a commercial or social causes (and by most estimates it is), then the data scientist is the key player, boasting the analytical and quantitative skills to unravel the mysteries hidden in big data and drive organizational goals.
It comes as no surprise then that working with big data garners big paychecks. After all, who wouldn’t pay up to snag a professional who has the vision to recognize valuable patterns in seemingly endless mountains of data and the creativity to pursue new and exciting data-driven insights and opportunities?
In recent years, data storage prices have plummeted, allowing many organizations to save enormous sets of unstructured data. This has resulted not only in increased job opportunities for data scientists but increased salaries, as well.
Wanted: Data Scientists (And Willing to Pay)
A 2011 report by the McKinsey Global Institute projected that more than 4 million big data-related positions will emerge in the U.S. by 2018. At the same time, they projected a potential shortfall of more than 1.5 million data scientists. Linda Burtch (of Burtch Works, an executive recruiting firm) reiterated McKinsey’s projections when she said, “The most common complaint among our clients is that there aren’t enough candidates.”
A 2014 data science salary survey by O’Reilly Media revealed a median, annual salary of $144,000 for U.S. data scientists. According to O’Reilly Media, these impressive salaries aren’t surprising, given that the demand for data applications continues to increase at a rapid pace, while the number of people capable of performing advanced analytics increases at a much slower pace. Further, fewer expert users exist to navigate some of the newer tools like Hadoop and Spark.
Another study by McKinsey projects that by 2018, the U.S. may face a 50 to 60 percent gap between supply and demand of “deep analytic talent.” There are a number of industries already experiencing this shortage, including insurance, finance, pharmaceuticals, and aerospace.
An April 2014 survey conducted by the consulting firm Accenture found that more than 90 percent of its clients said they planned to hire more employees with expertise in data science within a year. However, 41 percent of those surveyed cited a lack of talent as their main obstacle.
According to Burtch Works, data scientists who changed jobs saw a salary increase of nearly 16 percent in 2015, revealing the demand for data scientists in the U.S. and employer willingness to pay to attract new talent.
According to Burtch Works, data scientists earn appreciably higher salaries than other predictive analytics professionals. The overall annual average salary for data scientists is $120,000, compared to $95,000 for other professionals in predictive analytics. This trend extends to data scientist managers, who earn an average annual salary of $170,000, compared to predictive analytics managers, who earn an average, annual salary of $145,000.
Data Scientist Salaries: Where They Are, Where They’re Headed
The Robert Half Technology 2016 Salary Guide revealed a nearly 9 percent increase in data scientist salaries between 2015 and 2016. According to Robert Half, the salary range for data scientists in 2015 was $103,000-$138,250; in 2016, they expect the range to increase to $109,000-$153,750.
According to Robert Half, salary ranges for data scientists in some of the country’s largest cities (as of 2016) include:
- New York, NY: $152,600 – $215,250
- Dallas, TX: $118,265 – $166,819
- Los Angeles, CA: $139,520 – $196,800
- Miami, FL: $116,630 – $164,512
- Seattle, WA: $129,601 – $182,809
- Pittsburgh, PA: $106,820 – $150,675
- Saint Louis, MO: $109,000 – $153,750
- Atlanta, GA: $115,119 – $162,382
- Chicago, IL: $134,070 – $189,112
A 2015 Burtch Works publication, Salaries of Data Scientists, broke down salaries for data scientists according to geographical region. For example, in every job category, data scientists earned more on the West Coast and the Northeast than those in the Middle U.S. West Coast data scientists posted the highest salaries in the nation, bringing home a median base salary of $110,000; that’s 22 percent more than their counterparts in the Northeast and 38 percent more than those in the Middle U.S.
The Burtch Works study broke down data scientist salaries further by seniority/position, with Level 1 being entry-level positions and Level 3 being senior positions:
- Level 1
- Northeast: $90,923
- Middle U.S.: $81,723
- West Coast: $111,911
- Level 2
- Northeast: $124,738
- Middle U.S.: $113,517
- West Coast: $147,318
- Level 3
- Northeast: $161,920
- Middle U.S.: $145,543
- West Coast: $164,103
Burtch Works also revealed annual, average salaries for data scientist managers, by region and by level:
- Level 1
- Northeast: $154,250
- Middle U.S.: $137,750
- West Coast: $152,462
- Level 2
- Northeast: $182,211
- Middle U.S.: $171,357
- West Coast: $204,900
- Level 3
- Northeast: unavailable
- Middle U.S.: $217,800
- West Coast: $247,500
Between 2015 and 2016, the salary for Level 1 data scientists increased by 14 percent, revealing an increased demand for junior talent.
Level 3 data scientist manager salaries also experienced significant salary increases, with base salaries rising 8 percent between 2015 and 2016. According to Burtch Works, this is likely because many organizations now have established data science departments that require leaders to oversee them.