IT Job Market Slides In February, But Could Rebound In Summer
March 18, 2013 Jenny Thomas
What goes up, must come down. Sometimes this is good news, like in the case of gas prices or the Frisbee you stuck on the roof of your house last summer. But when you are talking about the job market, in particular the number of IT jobs available, down is not the direction you’d be hoping to see. It was just one month ago that the analysts at Janco Associates offered some hope to IT job seekers, with news of a spike in the number of new jobs for IT professionals in North America in the month of January.
But just a month later, Janco reports that according to U.S. Bureau of Labor Statistics (BLS) data, IT job market growth slows to 5,700 new jobs in February from a high of 9,800 new jobs in January.
Even with the U.S. unemployment rate falling to 7.7 percent, the latest BLS data shows the job prospects for IT professionals is still mixed. January was actually predicted to have a much larger job boom, but the BLS has since adjusted the number of jobs that were added in January from 12,500 to 9,800, and the threat of a government sequester is still out there, which would take a toll on the IT jobs market.
“When we looked at the number of IT pros employed and compared that with our own independent survey of 106 CIOs in North America, we can only conclude that the hiring freezes of 2008 through 2012 are slowly easing,” said Victor Janulaitis, CEO of Janco Associates. “We are seeing greater demand for mid-level managers and technologists who can address demands placed on CIOs for more web-enabled applications, and security professionals.”
In late January, Janco conducted telephone interviews with 97 U.S.-based CIOs and found cautious is still the rule of the day. According to Janulaitis, tax increases, unpredictable economic future, and an unstable world political and economic situation are making CIOs continue to closely manage overall headcounts. He said CIOs are focusing on the near-term demands and looking to hire proven IT professionals and consultants or contractors.
“A number of CIOs who we have interviewed have plans in place for more robust hiring in the summer and fall,” Janulaitis said.
The following graphics illustrates Janco’s data, revealing that while there is a good chance for new jobs in a general IT staff positions, new IT management jobs will continue to be hard to come by in 2013.
The Janco telephone interviews did find a few CIOs in selected locations like the San Francisco Bay area and Boston are more bullish about the prospects for growth within their IT departments. (This is where startup activity is warmest, of course.) And some of the interviewed CIOs said they will be looking for particular sets of skills to meet the demands of mobile computing and including support for employees to use their personal devices in the workplace.
The healthcare job market also continues to be a bright spot on the overall U.S. labor market. The implementation of electronic patient records is one of the driving forces in the increased opportunities for IT personnel in this area. The chart below depicts the total labor market in this sector.
The dark spot in the jobs data, according to Janulaitis, continues to be the labor market participation rate, which remains at record low levels. The macro trend for labor participation since 2008 still is down by 1.5 percent. “That translates to approximately 4 million people who are excluded from the labor force calculation,” Janulaitis said.
“The year-to-year comparison of workforce participation shows how deep a hole we are in. Until those percentages turn around, the overall recovery will be weak at best. If that is the case, then there is a strong possibility that IT demand will be dampened, and overall IT job market size could fall back to the levels of 2010 and 2011,” Janulaitis said.
That’s a drop that will leave a pit in your stomach. Let’s hope in the coming months we will see a nice steady climb in IT jobs growth. We could all use a smoother ride for a little while.