Nothing Funny About Latest IT Jobs Numbers
October 28, 2013 Jenny Thomas
The economy added 148,000 jobs last month. Of course, all those people were hired to fix the Obamacare website.
Funny, yes, but if only Jimmy Fallon’s recent Tweet on the latest job report were true, at least for our little sector of the world. The sad truth is the IT job market has been trending in the wrong direction and the September numbers marked the third month in a row of a slowdown in the creation of new IT jobs.
The folks at Janco Associates watch the IT jobs market very closely and release their analysis of the national numbers each month, focusing specifically on IT job creation. According to Janco analysts, September only saw 2,500 jobs added, a huge drop from the 7,000 jobs they reported were created in August.
The following illustration paints a clear picture of the rollercoaster ride the IT jobs marketplace has been on throughout 2013. We climbed to new heights in January, only to plummet in February, followed by a slow coast up during the spring and into the summer months, and now we’re back on the downside of the hill.
Janco analysts interviewed 94 CIOs in the last 30 days and concluded many IT departments continue to operate in a “controlled spending” mode, everyone needs larger budgets to implement new technologies, which would include the hiring of more staff, but there is little confidence in the current state of the economy.
“As part of the 2014 budgeting process, [CIOs] are constrained in the number of initiatives that they can plan for in the coming year,” said Victor Janulaitis, CEO of Janco Associates. “Over two-thirds of the CIOs interviewed say that the network infrastructure, which many have not been able to update because of budget limitations they have in place, is making it more difficult to implement new technologies without significantly increase costs.”
The three-month slump we’re currently in is not a friendly harbinger for the IT hiring environment. From their review of the latest BLS data, Janco analysts found it was the Telecommunications sector that was hardest hit, taking a nosedive with 2,700 jobs lost. The “other information services” sector didn’t help the cause, with a meager gain of 500 jobs (compared to the 2,000 added in August). Not even the improvements in computer systems design and related services with 4,500 jobs added (versus 2,400 added in August), and data processing and hosting related services with 200 new jobs (versus 100 jobs lost in August) could buffer the blow to IT job prospects.
Another factor effecting the number is the labor market participation rate remained, which Janulaitis said is at a 30-year low of 63.2 percent. In other words, there are 3,200,000 fewer individuals working now than in 2007. “The overall labor participation rate continues to be lower this year than any other prior year,” Janulaitis said. “This alone will make it a very difficult process and does not bode well for IT expansion and hiring.”
Hopefully the New Year will bring some new hope, and a smoother ride for the IT jobs market in 2014.