Growing Businesses, Upgrades Drive IT Hiring in Q4
October 8, 2007 Timothy Prickett Morgan
Fears of recession subsided last week thanks to a mediocre jobs report from the U.S. Labor Department that said employers added 110,000 jobs in September and 89,000 jobs in August, despite a slowdown in the construction and manufacturing sectors and jitters in the stock and mortgage markets. People were cheered last week–particularly on Wall Street–because jobs grew even though the economy seems to be slowing down a bit. So far, if surveys by Robert Half Technology are any indication, IT managers are still optimistic about the hiring they planned to do in the remaining three months of 2007.
RHT is a subsidiary of Robert Half International, the Menlo Park, California, staffing and consulting company that rakes in $4 billion a year; RHT is devoted to technology hiring, as the name suggests. RHI was founded in 1948, is a publicly traded company, and is the largest employee staffing and consulting company in the world. The company’s various divisions issue quarterly hiring planning reports for different industries. For the IT reports it issues, RHT polls more than 1,400 CIOs for data, and only looks at companies with 100 or more employees in total.
A few weeks ago, the RHT subsidiary released a report on hiring plans in the technology area, and 14 percent of the chief information officers polled said that they planned to increase their hiring in the fourth quarter of 2007–which means starting last week and running through the holidays–while only 2 percent of those polled said they would be making jobs cuts. That’s a net 12 percent increase in the number of IT organizations that are hiring, up from 10 percent in polls covering the fourth quarter of 2006, but down from the 15 percent net increase among CIOs in the third quarter of this year. Expectations were running high for the third quarter when American CIOs were polled in June, but shortly after that the housing bubble in the United States started to lose some air, mortgage-backed securities went under water, and Wall Street started to get nervous. About 83 percent of those polled for the Q4 estimates said they had no plans to add or cut employees in their organizations.
Some 73 percent of those CIOs polled for this quarter’s report said that employees with skills in administering Windows 2000 Server and Windows Server 2003 were in the highest demand, followed by 70 percent saying that network administrators with knowledge of devices from Cisco Systems and Nortel Networks were in demand in their shops; 60 percent of CIOs said that they needed database administrators with experience with Oracle, SQL Server, and DB2 databases.
“As competition for candidates intensifies in many specialties, organizations are starting to accelerate the hiring process, increase salaries and offer work-life balance benefits such as telecommuting opportunities and flexible work schedules to attract and retain top talent,” said Katherine Spencer Lee, executive director of RHT. Spencer says that growth (presumably meaning expanding into new markets and products) is the biggest reason why IT organizations are expecting to hire more staff, and this reason was cited by 45 percent of those who said they are adding employees. New applications were cited as the reason by another 15 percent of those adding people, and 18 percent said they needed to expand their help desks or end user support operations. ERP software installation is driving 15 percent of the expected hiring in the fourth quarter, followed by 9 percent for system upgrades, 6 percent for security, and 4 percent for regulatory compliance.
Companies engaged in the financial services, insurance, and real estate industries (which RHT lumps together for its public reports) expect to do a lot of IT hiring in the United States, with 23 percent of those polled in this segment saying they will add employees and only 2 percent expecting a decrease in their IT personnel. The retail, professional services, wholesale distribution, and business services sector also expect to be hiring at a rate above the national average in their IT organizations in the final quarter of the year as well–15 percent net increase in all four areas, in fact.
On a geographical basis, the Mountain and Pacific regions of the country expect to do the most aggressive hiring, and not surprisingly, .NET programming skills are in high demand in the Pacific states–Microsoft‘s stomping grounds and an area that has a rapidly expanding economy. Only 11 percent of those CIOs in New England expect to add IT employees, with 3 percent saying they will be making cuts, and only 8 percent of CIOs in the Mid-Atlantic states said they would increase IT staff, with 6 percent saying they will make cuts. The South Atlantic and Central regions are fairing much better than this, according to those CIOs polled.