JobWatch: Soft-skills win out in conflicting markets

After months in the doldrums, internet IT job ads took an upward turn in May, growing by 1.6 per cent, a whisker ahead of the overall internet job ads.
Written by Jeanne-Vida Douglas, Contributor on

After months in the doldrums, internet IT job ads took an upward turn in May, growing by 1.6 per cent, a whisker ahead of the overall internet job ads, which shuffled forward by 1.49 per cent. At the same time, salaries in the sector grew gradually, pushed up by an ongoing shortage of so-called soft skills.

"We have had what appears to be a movement in the right direction overall and in the IT sector in particular," said Bob Olivier of the Olivier Job Index. "We had four or five months of negative figures in terms of IT job ads, and this is the first glimmer of good news, but it's still too early to suggest the downward trend has troughed, the overall trend is still negative for 2008."

According to Olivier, many employers held back on appointments for the first half of the year in a cautious response to rising oil prices, and the US credit crunch.

Nonetheless, he remains reluctant to read the upturn as a recovery, as many of the May results were contradictory. Although areas like project management and architecture grew through May, areas which traditionally indicate market growth including software development and sales, went backwards.

"The market is going in different directions, and it's a bit hard to fathom where we'll be in a month's time," Olivier said. "In some cases we're seeing a return to hiring by organisations that have been holding off and are now more confident, but we'll need to wait to see if it becomes a trend next month."

Year on year the story remains positive with the IT job ads growing by 7.7 per cent over the last 12 months, as the ongoing demand lead to salary growth across the ICT sector.

"Over the last 12 months we've seen a slow, incremental increase in certain areas, not every role in every location, but a gradual increase across the board," said Peter Noblet, regional director of Hays Information Technology.

Released at the end of May, the annual Hays Salary Survey registered increases of around 10 per cent across the Information Technology sector for new appointments. While the high demand markets of Western Australia and Queensland have seen the greatest increases in salaries, according to Noblet, the increases merely brought these states more into line with New South Wales and Victorian markets.

"There's not been a wages breakout, rather a gradual increase in line with an increase in demand for certain roles, as such there's now a lot more parity between what's paid to CIOs in Sydney and Perth markets for example," Noblet explained. "We're also seeing pretty heavy increases in salaries for Voice over IP and communications engineering roles in Sydney and Melbourne, where there are a lot of unified media projects underway."

Despite the increases, Noblet shares Olivier's circumspection with regards to the general market direction.

"People are misreading the increase in suggesting that the market is booming, and this is not the case," Noblet said. "Salary increases in the IT sector have been measured and have reflected what's happening in the industry more broadly, and while there's a cautious optimism, there's still a lot of large projects being reconsidered due to conditions globally."

Amid the conflicting signals, it's the longer term outlook that's causing real headaches at specialist IT recruitment firm Peoplebank. In an attempt to determine how the rest of the year will play out in the ICT sector, Peoplebank chief operating officer Peter Acheson has been wading through economic forecasts and speaking with leading economists, to little avail.

"The big question for everybody is what's going to happen in terms of jobs growth in 2009, and nobody seems to be able to say with any certainty," Acheson said. "We're seeing strong demand driven by specific technology platforms like SAP, and as always there's demand for generic and industry specific business analysts, as well as systems architects."

According to Acheson however, much of the ongoing unfulfilled demand can be attributed to higher expectations on behalf of employers, and an ongoing shortage of soft-skills in the ICT sector.

"The big trend over the past three years is that businesses are demanding IT staff who understand the impact their role had on business processes rather than just focusing on technical skills," Acheson says. "What we're seeing more and more is employers recruiting on the basis of strong communication, business and interpersonal skills, and that's where the law of supply and demand is gradually pushing up salaries."

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