IT rates could soar in Canberra: study

Summary:A study has found that the number of ICT contractors employed in the public sector has fallen by 20 to 25 per cent in the last year, while another study has predicted could lead to a skills shortage in the nation's capital as soon as June this year.

A study has found that the number of ICT contractors employed in the public sector has fallen by 20 to 25 per cent in the last year, while another study has predicted could lead to a skills shortage in the nation's capital as soon as June this year.

Employment levels

The Peoplebank Intermedium Index
(Credit:Intermedium/Peoplebank)

The study by Intermedium and Peoplebank, Australia's largest IT recruiter; tracked federal ICT hiring rates to conclude that the latest employment levels are on par, if not worse, than low hiring levels during the economic downturn last year and in April 2005.

As a result, the number of contractors moving to Canberra for work was almost zero, with banking and finance industries in Sydney and Melbourne enticing Canberra's unwanted IT workers.

This current trend contrasts with previous years; in 2006/2007 almost a quarter of vacancies in Canberra were filled by workers from Sydney and Melbourne.

Jeff Knowles, Acting CEO of Peoplebank commented on the downtrend, suggesting the market would rebound, but perhaps not in time for current contractors exiting the ACT.

"It's a volatile market: where the downward trend of recent years is likely to be replaced, quite rapidly, by an upward trend in both demand and rates," Mr Knowles said.

Knowles said this rebound could result in an ICT skills shortage in the ACT, bringing with it higher costs or inexperienced staffers.

"As we are experiencing a net migration of contractors away from Canberra, there is a substantial risk that there will be too few skilled ICT contractors available to meet the government's needs," Knowles said. "This will intensify the upward pressure on contract rates — with the result that departments will face higher costs or risk being unable to secure the ICT skills they need to achieve their business goals."

Other studies have also reached similar conclusions, with a survey released last week by IT recruiter Greythorn predicting a skills shortage by the second quarter of this year.

"We are at the critical tipping point between candidate demand and candidate availability right now. If demand continues to increase as it has during the first part of 2010 — and we expect it will — Australia's critical IT skills shortage will have returned to pre-[crisis] levels by the end of the second quarter this year," Richard Fischer, managing director Greythorn Australia said in a statement.

Peoplebank's study concluded ICT rates have already begun rising, with senior .NET developers earning $110/hr in April 2010, compared to $90/hr in November 2009. The study determined that increasing demand for contractors, coupled with reduced contractor levels as workers exited the state could see rates exceeding previous rate peaks in 2006/2007.

Topics: Government, Government : AU, IT Employment

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