JobWatch: What goes up is now coming down

The sharp rise in demand for IT skills throughout 2007 is well and truly in retreat according to the latest figures from the Olivier Job Index.
Written by Jeanne-Vida Douglas, Contributor

The sharp rise in demand for IT skills throughout 2007 is well and truly in retreat according to the latest figures from the Olivier Job Index. Internet job ads covering the IT and T sector fell by a total of 1.92 percent in the month, bringing its fall to 9.73 percent since it first took a downward turn in February this year.

Overall the news wasn't much better. Falls in the number of Internet job ads covering sectors like banking and finance met a rise in sectors like mining, engineering and transport, leaving the overall result a flat 0.01 percent increase in ads throughout the month of April.

"It's surprising that IT is taking such a hit, you can understand business and consumer confidence being hit by the interest rate rise, and the banking and finance sector being hit by the credit crunch, but IT is largely project driven and usually less affected by these kinds of knee-jerk reactions," commented the reports author Bob Olivier.

And while demand for core IT positions such as software developers was particularly heavily hit, falling 7.1 percent in April (off the back of a 6.5 percent fall in March), Olivier believes the IT market is still essentially undergoing a necessary correction rather than a worrisome downturn.

"The situation facing employers is good, because there is now less competition for the same people, and IT employees shouldn't be too worried because we are still coming off a very strong market," Olivier observed. "The credit crunch might have some temporary effects, but the skills shortage is going to be here for a while to come."

These trends identified by the Olivier Job Index are being reflected at the market level, according to Peter Acheson, chief operating officer of IT recruitment firm Peoplebank.

"What we're seeing isn't a dramatic swing in the number of jobs, it's more of a flattening out of the market, and a move away from the boom time and severe skills shortage of 2007," Acheson offered. "Clearly there's been a drop in the overall market, but we've still got clients talking about launching new projects in the coming months, so there is still a lot of work around."

However, many of these are so-called "hard-to-fill" positions requiring a mixture of business, technology and communication skills.

According to David Gage, general manager of Dimension Data Learning Solutions (DDLS), courses which feature a communications component have been in high demand since they were launched in late 2006. In fact, in the last intake, classes grew by 68 percent in the communications stream.

"At the moment there are two areas where we are experiencing tremendous growth," Gage explained. "One is project management, where we offer ITIL and those kinds of courses, and the other is what we call people training where we look at communication and negotiation skills."

DDLS has also integrated a greater business communication and interpersonal communications stream into its cadetship programs, a move proving popular with IT workers looking to expand their opportunities.

"We provide companies with trained IT cadets for entry-level positions, we provide the training to take them through the technical skills, as well as negotiation and communication skills," Gage explained. "We run the seminar series every fortnight, and we're attracting record numbers, the overwhelming majority of who are career changers."

And it's these multi-skilled IT professionals who will find the work and command the higher salaries, according to Patrick March, national practice leader IT and T for recruitment agency Hudson.

"We've noticed in the last six months salaries have been rising, and more than enough to keep up with inflation, especially for the right combination of business and technical skills," March says. "We're still seeing a lack of good people skills mixed with IT skills, what employers really want is someone who can talk technology with one person and business with another."

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