Is There Really an IT Labor Shortage?

Over the last several years a number of IT industry executives and analysts have consistently promoted the idea that there exists an ever-present shortage of skilled IT workers in the market to fill the industry’s demand. High-profile executives such as Bill Gates of Microsoft and Craig Barrett of Intel have weighed in on their opinions about this shortage of good help in the server room and at the keyboard.

Most recently the theory of a growing shortage was bolstered by a December 2007 Gartner report entitled “The Quest for Talent – You Ain’t Seen Nothing Yet.” One of the report’s authors, Andy Kyte, went so far as to say in a statement that “(t)his is a massive and devastating skills shortage, and it is coming when there is a surge in the number of projects that are required from IT.”

But there is a growing resistance to this “common knowledge” of IT labor shortages—a number of economists, academics and industry experts refute these claims, stating that there simply isn’t any hard evidence to support the idea that there is or soon will be an IT skills shortage.

“It seems like every three years you've got one group or another saying, the world is going to come to an end there is going to be a shortage and so on,” said Vivek Wadhwa, a professor for Duke University’s Master of Engineering Management Program and a former technology CEO himself. “This whole concept of shortages is bogus, it shows a lack of understanding of the labor pool in the USA.”

Wadhwa has been studying the IT labor market since his transition to the academic world, when he began hearing student anxiety over the availability of jobs in the wake of increased offshore outsourcing and onshore hiring of foreign guest workers. He’d heard all of the business claims of skills shortages to justify these practices, but these assertions didn’t jibe with students’ perception of diminished job prospects in technology. His findings have so far shown no indication of skills shortage.

For example, in one study Wadhwa illustrated the disconnect between industry leadership’s opinions about skills shortfalls and the quantitative facts that contradict these opinions. He and his students at Duke went straight to the hiring source, the human resource department, at a number of top companies employing IT workers.

They asked HR professionals a number of questions that would speak to the availability of qualified workers, about topics such as the number of applicants received for IT jobs, the speed with which these positions are filled and the overall satisfaction with the employees eventually hired.

The portrait painted by the question’s answers were very different from their executive’s opinions on skills shortages, Wadhwa says, explaining that each indicator showed there was no lack of qualified applicants.

Wadhwa’s most recent research (download) released in January bolstered his opinion that there is no shortage of IT workers here in the U.S. as compared to the outsource havens of India and China.