Bonuses for Data Engineers: What is Normal?
This blog is contributed by Burtch Works' data engineering recruiting team.Are you a data engineer wondering if your bonus lines up with the rest of the market? Are you a hiring manager wondering if your compensation plan is competitive?This post, which is an excerpt from our 2021 salary report for the data engineering field (which can be downloaded for free here), shares some of our compensation data, specifically related to bonuses for data engineers. You can find more data on salaries, demographic information, and hiring trends in the full report.
Data Engineer Bonuses: Eligibility and Means
One interesting thing that we found while examining our report sample data on bonuses for data engineers is that bonus eligibility in this field is very high, making bonuses a key portion of the compensation package. 80% of early career individual contributors (those within the first five years of their career) are bonus eligible, which goes up to 88% for senior individual contributors, and 95-96% of managers.
Bonuses varied depending on job level, especially between individual contributors and managers. For early career individual contributors, the bonus mean was $22,283, while for senior-level leaders the bonus mean was $64,218. For more information on how we define data engineers you can check out this post, and to see how we segmented the data engineers in our data sample, you can read the table below.
What Types of Performance Bonuses Are Common?
Typically, we tend see three main types of performance-based bonuses. Some employers may just distribute one of these, but we’ve also seen some employers utilizing all three. These may include:
- Bonuses based on an individual’s performance
- Bonuses based on a team’s performance
- Bonuses based on company performance
In the case of startups, we sometimes see bonuses replaced with stock options, but because of their variable nature these can be difficult to accurately measure and compare. We’ve also seen companies who can’t necessarily compete with “Big Tech” salary ranges, using bonuses based on performance to address the gap.
The Return of the Sign-On Bonus
More recently, we’ve seen the return of sign-on bonuses in several types of situations including:
- Using a $5,000-$10,000 sign-on bonus to help close the deal during the hiring process
- Some companies have been using sign-on bonuses in lieu of relocation packages
- Awarding sign-on bonuses to employees whose start dates miss the cutoff for annual bonuses
In our experience, most professionals assume that if they’re accepting a position, there will either be some type of annual bonus potential and/or equity available to them, and many tend to prefer individual bonuses since that is based on their own performance. In cases where a company bonus is on the table, we usually advise data engineers to inquire about historical data on how company performance bonuses have paid out over the past few years.As we know from our recent survey on what keeps data engineers satisfied at work, bonuses are typically not seen as being more desirable than a salary increase, however, they are a key component of the whole package. Bonuses can also be a way to recognize an individual or team for their hard work, and help them feel more invested in their work when it directly results in a reward!