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Unlocking Employee Satisfaction: 5 Compensation Trends for Attracting and Retaining Tech Talent

What do employees want from their workplace now and in the future? In recent years, the focus has been on achieving a better work-life balance, shorter work weeks, and the flexibility to work remotely when necessary. Some of these benefits were particularly in demand during the “Great Resignation” period. Today, however, the employment landscape has evolved, and companies must invest in attractive compensation to retain their employees for the long term and fill vacant positions. Yet, compensation is more than just an appealing paycheck at the end of the month. In this article, we highlight five compensation trends that can help attract and retain tech talent.

Particularly in the IT sector, where there are 137,000 job openings and intense competition for talent, the success of recruitment relies on the competitiveness of companies, among other factors. According to a Glassdoor survey, the average total compensation cost for IT professionals in Germany in March 2023 was €60,936 per year, with additional cash compensation estimated at €4,700. However, there are additional aspects of attractive compensation beyond the figures on the invoice.

1. Compensation transparency scores

In theory, employees who perform the same work are entitled to the same pay. However, salary discrepancies still exist in many industries. Therefore, companies are advised to transparently communicate their compensation system, such as by listing salary ranges in job advertisements or creating an internal company page that provides salary information based on work experience, education, training, and employees.

2. Consider current conditions

Inflation is causing the cost of living to rise in all aspects of life. In January 2023, inflation reached 8.7%, making the salary amount crucial for many employees this year. Experts predict that wages will increase in 2023. Consequently, companies that reduce employee compensation are saving in the wrong place. Instead, they should proactively find ways to adjust salaries to the rising cost of living.

3. Continue to expand flexibility

To attract top talent, companies should continue embracing flexible work options. Hybrid remote and in-office work, flexible working hours, and consideration of individual circumstances remain highly popular among employees. Therefore, companies should maintain or even expand such offerings this year to stay competitive in the race for the best talent. Moreover, companies also benefit when employees can optimize their time.

4. Protecting employees’ mental and physical health

The fast-paced work environment, the complexity of tasks, and rapidly changing factors can take a toll on employees’ mental and physical well-being. Nearly one-fifth of work absences in Germany are due to mental illness. The significance of physical and mental health will continue to grow this year, prompting companies to invest in their employees’ well-being. Preventive measures can be taken early on to ensure that exhaustion, work stress, and performance pressure do not adversely affect productivity. Furthermore, appropriate health benefits can serve as an advantage in recruitment.

5. Investing in further training opportunities

There are concerns that the current economic uncertainty has led to reduced spending on training opportunities. However, companies that wish to retain employees or attract new talent should proactively invest in learning and development opportunities. This approach ensures that they emerge from the economic crisis stronger and ready to seize opportunities when the economy recovers.


In the pursuit of attracting and retaining tech talent, companies must adapt their compensation strategies to align with evolving employee expectations. Transparency in compensation, consideration of current economic conditions, flexible work options, prioritizing employees’ mental and physical health, and investing in training opportunities are all key factors in building a competitive and appealing compensation package. By embracing these compensation trends, companies can position themselves as employers of choice and thrive in the ever-changing employment landscape.

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