Even as the threat of a recession looms over the economy, many IT professionals remain cheerful about their job prospects due to the sector’s robust hiring trends over recent months and predictions that IT job growth rates will continue to rise in spite of an increase in general unemployment.
Yesterday the Fed projected that the national jobless rate will rise to between 5.2 percent to 5.3 percent this year, revising previous prognostications that it wouldn’t surpass 4.9 percent in 2008. But IT workers remain confident about their employment status.
Created by Harris Interactive on behalf of Spherion Corporation, the IT Employee Confidence Index rose last quarter by 0.2 points. Harris bases this index on a number of statistics gathered for the Spherion IT Employment report, which found that the percentage of technology workers who are confident in the future of their current employer increased from 62 percent in third quarter of 2007 to 66 percent in the fourth quarter of 2007.
Currently the Bureau of Labor Statistics reports that unemployment in IT is half that of the employable population at large and most industry reports indicate that IT job growth is poised to continue unabated this year. On Monday, the National Association of Computer Consultant Businesses (NACCB) reported that IT employment in January grew 7.9 percent year over year.
“Despite widespread economic concerns, IT employment remains strong,” NACCB CEO Mark Roberts said in a statement about the findings. “While the subprime credit crisis, the weakened housing sector and the relentless stream of negative economic reports in the media would lead one to expect a softening in demand, we have not yet seen it. Outside of a handful of sectors, demand for IT professionals remains robust.”
The strong IT hiring statistics are likely influenced by what some have labeled a skills shortage within the sector. Just this month Gartner analysts released a report that said a lack of talented and skilled IT workers is stunting business growth. In spite of this skills shortage and the steady growth in IT hiring, technology professionals may not come away completely unscathed from the recession’s belt-tightening effects.
Salary increases are expected to slow for IT workers this year. A survey released this week by the IT employment site Dice.com found that among a survey sample of 19,000 IT professionals the average salary only rose by 1.7 percent in 2007 as compared to 5.2 percent last year. And the Computer Economics 2008 IT Salary Report projects that the salary growth rate will remain steady this year, expecting a slight dip of 0.1 percent more in increases under last year’s salary growth rate.
The report from Dice found that the salaries across all titles and all regions in the United States averaged $74,570 last year, with upper-level IT managers raking in an average of $101,292. Those lower down the totem poll at enterprises or those managing as a one-man-band at small companies averaged $88,934.
In the coming year Computer Economics expects those holding down networking-related positions will garner the highest pay raises at a projected rate of 3.9 percent. Developers are expected to follow with a hike of 3.7 percent, while operations staff, executives and managers are projected to see a 3.5 percent raise in salaries this year.
Rather than tap into IT’s human resource budgets, companies may look for other ways to streamline their IT budgets if the economy continues to skid. Last week, analysts from both Forrester Research and IDC revised global IT spending outlooks to account for the dampening effects of an economic downturn.
Forrester reduced its initial 9 percent increase in spending down to 6 percent. IDC now predicts IT spending will only grow by 5 percent this year. This means IT staff may be expected to do more with less this year, potentially affecting job satisfaction.
According to the Hudson Employment Index, a measurement of US workers’ confidence in the employment market, IT worker satisfaction has declined over the past year. The index recently showed that the number of employees happy with their IT job decreased by 3.6 percentage points from January 2007 to January 2008.