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A new report shows that almost a third of the $1.2 trillion in software sales in 2015 came from companies that didn’t pay their workers a minimum wage.
That includes nearly $800 billion in software revenue that is made up of software licenses and royalties.
The report, “The Software Revolution: A Global Perspective,” released Monday, is based on research by the software-industry-tracking firm Avalere Group and the International Labor Organization.
The study found that software companies paid less than $2 per hour for the work of their most-profitable workers.
“The industry is already suffering from a $3.8 trillion in underutilized capacity, and we’re only getting worse,” Avalere CEO David R. Hall said in a statement.
“This report makes clear that the technology industry needs to fix its underlying structural problems, which include a lack of productivity growth, a lack to retain key employees, and poor labor relations.”
This week, Avalere and the ILO released a report that said the software industry is still far behind the rest of the developed world on improving its labor conditions.
“In 2015, software firms in the United States paid their employees a median wage of $7.28 per hour, or about $20,000 less than the average worker in the developed economies surveyed,” the report said.
“However, these average wages are significantly below the $8.20 per hour median in Japan, $14.60 per hour in the UK, and $21.30 per hour the Netherlands.”
The report found that in many of the most-compensated industries, including software, it was impossible to find the most productive workers for low-paid jobs.
In one case, software-related employees in the retail industry were paid $8 per hour to run their stores, but they were not paid $12 per hour because of the lack of a minimum-wage law in the industry.
Avalere also found that many of software companies did not provide workers with sick pay, disability benefits, vacation pay, or paid time off.
And in some cases, companies paid workers to sign off on contracts that were not in their best interests, the report found.
For example, in a case of a software company that employed 20 people, it agreed to pay the workers a $100,000 signing bonus if they worked for one month without any overtime.
In another case, a software developer was given a $300,000 payout after being hired for a year, but was told the contract had expired.
“Software companies that have not yet established an incentive to create a strong workplace culture should invest in building a culture of teamwork and accountability,” the ILOPI said in its report.
In the report, the ILOs analysis found that a majority of the software companies surveyed were in the bottom fifth of the global software market.
The software companies that were among the top 20 were Apple, Google, Microsoft, Oracle, and Salesforce.
Other notable names among the software giants are SAP, IBM, Oracle and Adobe.