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The New IT Department: Hiring Back on the Rise If you've been biding your time, waiting for the right moment to seek new opportunities in IT, your moment may be at hand. October 25, 2006 (Patrice A. Kelly, DRi) -- If you've been biding your time, waiting for the right moment to seek new opportunities in IT, your moment may be at hand. After several years in the economic doldrums, the IT field is showing every sign of resurgence, with new technologies, corporate expansion, and a shortage of talent in specialized areas ramping up employment opportunities. Indeed, for IT professionals with the right in-demand skills and qualifications, this could be one of the best years since the dot-com bubble burst. As a result of the decline in demand for computer professionals early in this decade, enrollment in computer science undergraduate programs nationwide fell by more than 60 percent between 2000 and 2004. According to the Fiscal Policy Institute's (FPI) Prospects for Information Technology Jobs in New York's Finance Sector 2005 report - which examines economic and labor market conditions in the major IT market of New York City and New York State -- this trend is likely to reverse as the industry begins to upgrade and develop new IT applications. Additional opportunities are also being created as baby boomers approach retirement. Recent news indicators suggest there is a growing shortage of IT workers in many parts of the country. Recruiters across the country are seeing a new surge in demand for technology workers, and not just in the technology sector. "We really see demand for IT across the board," says Saven Bellarmino, principal at Parallel Partners, a Chicago-based IT search firm. "I think in every industry, the demand is up. Sarbanes-Oxley has put additional requirements on companies and they need people to be able to handle that and there's not enough to go around." More jobs, at last Several leading indicators point to an expanding IT employment market. The American Electronics Association's Cyberstates 2006 report, released in April, noted a 1 percent increase in high-tech employment last year, amounting to 61,000 new jobs. That may not sound like much, but it's the long-awaited turnaround from losses of 45,000 jobs in 2004 and 333,000 in 2003. Robert Half Technology, a staffing company, forecasts in its IT Hiring Index and Skills Report a 20 percent net hiring increase for 2006 at companies with 1,000 or more employees. At the same time, the study found that smaller firms with 250 or fewer workers would see a 5 percent net increase in IT staffing. Bellarmino sees this surge in hiring as the logical outcome of the job-slashing trend of a few years ago. "I think that during the downturn, as companies were holding back on making new technology acquisitions, there was a combination of factors going on," she says. "Many, many people were out of work and looking. Some of those people decided to pursue other career directions out of the IT field and, consequently, now that companies are on the upswing again and making purchases of new technologies, there's not enough workers available to fill those spots." Many industries are seeing a rise in demand for technology workers. "The bulk of our work has been with health care and retail -- those are the two hot ones," says Aaron Osminski, senior account manager with Excel Resources, an IT search firm based in Salt Lake City, Utah. "We are seeing some technology security. That is also a pretty good place to find positions." The FPI report on New York's financial industry, which accounts for a substantial number of IT workers, shows recent gains that could enhance sector employment opportunities. From the December 2000 peak, employment in banking and securities dropped by almost 47,000 jobs (15.7 percent) through May of 2004. During the last year, however, employment in banking and securities grew by 2.1 percent. The job growth in securities was particularly strong, increasing by 3.6 percent, or nearly 6,000 jobs. Foremost among the factors driving the rosier job market is a rosier economy. Many firms are taking on more spending and expansion, including many that haven't done so since the recession after the dot-com boom. Also, new startups continue to enter the marketplace, each angling to become the next MySpace-like hit company. Outsourcing Is NOT an Issue The media abounds with stories about American jobs going offshore. High-end estimates predict that between now and 2015, some 3.3 million U.S. information technology jobs will move offshore. But that prediction ignores a crucial factor: The information technology industry continues to grow, and job creation now outpaces job loss. The jobs that get outsourced overseas are the ones that have become routine and commoditized, and where U.S. worker productivity no longer beats that of foreign workers. "Where the IT world was shaken to its roots [was] by the whole outsourcing phenomenon, where everybody was seeing jobs go offshore," says Bellarmino. "I think now we are reaching the realization that while offshore outsourcing can be a valuable addition to a company's resources, it is never going to be able to replace the type of work that needs to be done in the United States. So we're seeing more and more positions come back here. And certainly, a lot of the work that's being done on a repetitive basis can be done offshore, but the more highly skilled positions are back here now." With the more skilled positions returning onshore, domestic prospects are improving. The job listings board Dice.com noted a 26 percent increase in technology job postings. Who's Getting the Jobs While the market appears to be expanding, those new opportunities may not be taken by entry-level hires, partly because there aren't as many potential candidates for those positions. The Government Accountability Office (GAO) found that only 27 percent of postsecondary students obtained degrees in science, technology, engineering and mathematics in 2003 and 2004, down from 32 percent in 1994 and 1995. If anything, the new positions opening up in IT are likely to be taken by people already in the field. Forty-eight percent of IT professionals anticipate launching a job search soon, according to the Spherion Corporation's Q1 Employment report, compared to 34 percent of the overall American workforce. Another reason that entry-level hires may not be flooding the IT job market is that many of the positions opening up require advanced industry experience, or competencies likely to be gained only in real-world situations. While companies anticipate some hiring, they're going to be selective and targeted about it, seeking out only skilled candidates for specific functions. "The demand right now seems to be for people of medium-level skills," Osminski says. "They're not looking for the entry-level people right out of college, but they're not looking for the super-senior people that have 15 years of experience, either. Everybody I talk to seems to be looking for someone with a good, solid four or five years of experience. I would say the majority of the positions we fill are looking for some good solid real world experience and a mid-level salary." 2006 Growth Areas If your strengths are on the technical side of the house, there will be some potential room for growth in the coming years. But if you've spent the last few years building your skills in "soft" areas like project management and business communication, and if you can demonstrate how you can help a company hit its financial numbers, your range of opportunities may be much wider. The Robert Half study noted areas where demand - and salary increases -- will likely be higher than average this year:
But the skill that might set a successful applicant apart from the field has almost nothing to do with technology per se, and more to do with basic communication and business understanding. "I'd say that one of the most important skill sets we've seen asked for in any technology -- database developer or any of those -- is people skills, the ability to communicate with clients directly," Osminski says. "So we're seeing a lot more client-facing people in these technology positions. That is the one thing that seems to be coming up across the board. People are looking for those soft skills and the ability to communicate with clients. They are looking for technical, but [workers] still have to be able to look people in the eye and communicate well." In finance in particular, there appears to be an increase in demand for individuals in project management. A key reason for this is the outsourcing of work previously done within the firm. Firms need individuals to manage these projects from both the client and vendor perspectives. Facing the bottom line Companies may be hiring again, but having survived the last few years of tightened belts, they won't be as likely to staff their IT departments with people who only work with computers. IT departments will be increasingly expected to exist less in a self-contained vacuum, and more as a vital contributor to the company's bottom line. Employers are looking for people who understand the company's business environment and challenges, and who can help the firm not only run more smoothly, but more profitably. Gartner, Inc., reported last year that six out of every 10 IT employees would assume business-facing roles by 2010. "More and more, we are seeing a need for business skills in addition to the technical skills," says Bellarmino. "And so candidates that have not only developed an expertise in a technical area, but have been intellectually curious and interested in working with the business side as well, are the most in demand." Today's IT candidates will be expected to know not only their specific function, but also how that function integrates into the business' core processes. Some companies are even bringing in IT hires from other sides of the house, preferring someone with an MBA to another candidate with a computer science degree. "What we have seen happening is that positions are getting more and more highly specialized and we see that continuing to happen," says Bellarmino. "So a 'jack of all trades' isn't going to be able to fill the bill any more. You're going to have to keep yourself current in your skills." The Final Word All in all, the future of employment in the IT arena is getting brighter. Demand is up and supply is running low - the best combination of circumstances for job seekers. "The future of hiring on the managers' side, in terms of getting employees, is going to get more and more difficult," Bellarmino predicts. "With demographics and the labor market, qualified people are already in tight supply and it's going to get a lot tighter as time moves forward. As a result, I think there needs to a whole new emphasis on culture and quality of life in the workplace -- even more so than we are beginning to see now. "People weathered quite a storm in the early part of the decade," she says. "Many people tightened their belts and lost their jobs and are now being courted back to fill these empty positions. But they're not forgetting how easily the axe fell when times got tough. So now it's up to the managers to remember that employees need to be nurtured and offered opportunities for growth [in order] to be able to attract the type of people they need to have." View the article at dristaffing.com |
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