This blog is an adapted excerpt from our new 2021 Data Science & Analytics Salary Report, which includes 50+ pages of data and insights on compensation, demographic trends, and other research on hiring trends, WFH, and much more! You can download the full report for free here.
With the prevalence of advanced data science & analytics becoming such an integral part of staying competitive in today’s market, we reviewed this year’s data with keen interest to see what trends have been developing in this space. The past year has obviously accelerated some of these shifts, and below is a spotlight on just a few of the trends we’re keeping a keen eye on in the years to come.
1. Traditional Analytics Use Cases Expanding Further, Healthcare Accelerating
Comparing industry demographics for our predictive analytics sample (those working primarily with structured data) against our 2016 data shows very notable changes. Following the trend of previous years, the percentage of the sample employed in Financial Services continued to decline from 30% in 2016 to 11% in 2021, and the percentage employed by Marketing & Advertising firms declined from 22% to 16%. However, as we’ve seen the use cases increase in other industries, the percentage employed in Healthcare nearly tripled from 2016 to 2021, and we also noticed significant gains in Retail.
Financial Services and Marketing firms have long employed predictive analytics methods, but these industries may not necessarily be increasing capacity at the same rate as some other industries that, years ago, would have been considered more niche. But with Healthcare applications accelerating (especially after the past few years) and startups continuing to push the boundaries of analytical applications, there is an increasingly diverse array of opportunities in more areas than ever before.
2. As More Industries Explore Advanced Use Cases, Data Science Pushes Beyond Tech
For data scientists primarily working with unstructured data (our data science sample), we’ve also seen a noticeable shift in industry demographics when examining our sample against previous years. In 2017, 41% of our data scientist sample was employed by Tech firms, whereas the tech industry only comprised 20% of our sample in 2021.
While many data scientists may have felt in previous years that the most advanced data science applications were only to be found in West Coast tech firms, there has been a proliferation of machine learning and deep learning in even more traditional industries, as well as an increase in innovative startups in a variety of industries. As digital transformation has been spreading throughout more industries, there is no longer one dominant industry for advanced data science.
3. Ecommerce Boom Pushes Retail Salaries
Over the past few years, the ecommerce disruption and digital transformation in retail has had a noticeable effect on retail salaries, which were uncharacteristically high in 2021 compared to past years. While some brick-and-mortar-dependent retailers struggled to adapt in 2020, those with a strong ecommerce presence (or those who pivoted their business plan accordingly) were thriving. Many of these companies are continuing that momentum in 2021, with increasing valuations leading to increased investment to drive the business forward. Many retailers, especially those with a strong online presence, have been expanding their teams and offering higher compensation than we’ve typically seen in retail in prior years. While retail salaries might not be on par with the typically-high tech industry salaries just yet, digital transformation and ecommerce are leading the way for the retail industry as a whole to be more competitive in the hiring market.
4. How Will WFH/Remote Workplaces Impact Salary Trends?
As with other fields, there can be substantial regional salary differences in data science and analytics, driven by factors like cost of living, access to local talent, and more. Typically, West Coast data scientists and analytics professionals have seen higher salary ranges, but will this change as some of these companies take on remote staff in other areas? Will companies still pay the same price if talent is in a region with a lower cost of living? Will companies specifically target specialized talent in these areas to avoid, for example, paying a Bay Area premium?
There has been a continued demand for data science and analytics talent, and the widening of the talent pool, spurred on by the increase in remote opportunities, could have a number of short- and long-term effects on regional salary bands that may take some time to fully emerge.
5. As Business Applications Increase in Complexity, Degree Trends Show Increase in PhDs
In both the predictive analytics and data science samples, there was a notable increase in the number of professionals with PhDs, which is a slight reversal of the trend from previous years where we had seen the sample (especially at the early career level) starting to lean towards Bachelor’s or Master’s degrees. The data science sample increased from 43% PhDs in 2020 to 48% in 2021, while the predictive analytics sample jumped from 15% PhDs in 2020 to 19% in 2021.
As business applications for data science and analytics have become more complex, we’ve seen increased interest from PhD students (and experienced academics as well) to transition from academia or research positions into business roles. Many graduate programs are also offering more business internships, so students who are intrigued by the types of applied use cases for their work in the corporate sector (including computer vision, IoT, and NLP, among others) may opt to move into business roles.
When it comes to employment options, we’ve often found that data scientists and analytics professionals with PhDs who’ve proven they can translate their extensive research capabilities into business applications will often have the advantage in the hiring process. Even at the senior leadership level, where leadership and management skills and the ability operate a successful team are often considered the most important requirement, having a PhD can still give executives an edge if they’re in competition for a role.
Interested in our salary research on data scientists and analytics professionals? Download our latest 2021 report using the button below.
Want to learn more? Check out our webinar recording below, where we share data highlights, additional insights, and market research that we examined this year.