There’s been lots of interesting stuff in the news recently. I’d like to highlight several articles that discuss different but related issues facing CIOs, HR, and any others responsible for staffing and managing an IT department or company.
At Staffing 360, we try to do what we say we will in our tagline: “cover the world of IT consulting and enterprise-wide staffing from all angles.” At its most basic this simply means writing articles that appeal to all our readers: hiring companies and job seekers, employers and employees, clients and contractors. Some columns relate more to one constituency or the other but many, I hope, have information that can help either. This post gathers articles that offer interesting views and predictions about the industry in 2013 and the technology trends that will shape the business world including what jobs will be the hottest and therefore potentially the highest paying and most difficult to staff. I’ve also included a salary comparison tool (roughly benchmark what you’re making or paying), a list of the top companies hiring and traits that every good employee should possess, regardless of what industry you work in.
Every day brings a new story about the “severe IT personnel shortage” and the “war for IT talent.” Those of us on the front lines can attest that, while a little hyperbole is at work in the headlines, the stories are mostly quite true. It is no longer a buyer’s market in the IT industry. Finding the right IT consultants is getting more difficult by the day and some niche skills are at nearly 0% unemployment. These shortage stories are matched in frequency by the reports of how many employees are unhappy in their current positions and plan to look for a new job in the coming year, estimates range from 50% to as high as 85%. How can businesses find the IT personnel they need to grow and prosper? What can an employee considering a career change do to instantly start the process and increase the odds of a successful move? One answer to all of these questions is LinkedIn. In this week’s post I’ll focus on the employee side and next week, I’ll cover the hiring side of things.
TechServe Alliance released its IT Employment Index figures for March 2012 this week, showing that IT employment has reached an all-time high and that the demand for IT talent, which has been growing steadily for some time, remains strong. Recently, the SIA reported on a Teksystems’ survey that reported 37% of IT Leaders expect to increase temporary hiring. An annual Harris Interactive/CareerBuilder survey found 54% of employers indicated plans to hire college graduates this year with 25% of them saying they have Information Technology jobs to fill. Finally, there seems to be a new skill or IT job each week that is experiencing talent shortages and this article from WANTED Analytics about cyber security concerns and computer security specialists is a good example.
Off-shoring of IT talent has always been a controversial, if not caustic, issue. Companies need to stay competitive and are constantly looking for ways to get work done for less so that financial resources can be directed elsewhere. US workers find it nearly impossible to compete with the lower wages earned by their counterparts overseas. It’s a difficult and sensitive situation that has evolved over the years with a variety of people arguing both sides of the issue.
But what is the current state of IT outsourcing?
Is it still a problem? Are companies still utilizing it? What about the government? Have they gotten involved? In this two part post, we will attempt to tackle these question by offering a thorough and thoughtful analysis of the current state of IT off-shoring.
What is off-shoring?
Off-shoring is a type of outsourcing that involves moving certain business functions to another country. Within the realm of IT in the United States, these countries usually involve one or more of the following countries: India, China, Russia, Ireland, and the Philippines.
Reasons for off-shoring
Saving money is the major reason for off-shoring IT functions. Wages for IT workers overseas are typically much lower than here in the US. Money saved in one area of a business can be used in another. It is a strategic decision. One that is made in an effort to increase a company’s competitiveness.
The other significant reason for off-shoring IT talent and functions is difficulty in finding qualified candidates in the US. It’s true, there is an extreme shortage of IT talent in the US. We’ve discussed the topic many times on Staffing 360:
Are You Prepared for the Coming IT Staffing Crisis?
Solutions for the IT Talent Shortage
9 Must-ask Questions for Hiring IT Contractors
The President even spoke of the shortage during a recent Hangout on Google+. And in the State of the Union, the President said he hears "from many business leaders who want to hire in the United States but can’t find workers with the right skills. Growing industries in science and technology have twice as many openings as we have workers who can do the job. Think about that -- openings at a time when millions of Americans are looking for work." Off-shoring is one way that companies are dealing with this shortage of IT workers.
Current Off-shoring issues
For all its promise, off-shoring does have issues that are currently having an impact on its growth.
Wages for IT workers in places like India and China are on the rise, making off-shoring less attractive. This increase in salaries will only continue, reducing the effectiveness of one of the major advantages of off-shoring. An analyst at Forrester Research stated that there are a number of ever increasing challenges with off-shoring, including wage increases.
IT employment numbers continue to defy economic news. While most sectors of employment are in recovery mode, IT employment has reached an all-time high.
We’ve discussed the IT talent shortage before on this site. This week an article on CNET about an innovative idea to address the problem caught my attention. In NYC High School Will Train Badly Needed Software Engineers, columnist Daniel Terdiman reports on plans to open The Academy for Software Engineering in the fall of this year. The Academy’s main focus is going to be training the next generation of software engineers. The expectation is that 400-500 students will attend, drawn from applicants across the city based on their interest in software development not based on academics. This is an important point since the kind of student who can become a talented developer does not necessarily excel in subjects across the board. That said, the school will offer a rigorous college preparatory curriculum. The project is spearheaded by a group of prominent New York technology leaders and has the backing of Mayor Michael Bloomberg. If the Academy is successful it will likely be a blueprint for similar efforts in other cities and schools.
IT unemployment trends have often bucked overall national numbers throughout the recession and recovery, and hiring forecasts for IT in 2012 suggest that competition for experienced IT professionals with in demand skills (e.g., Java, .Net, mobile and app developers, software and system engineers) will only grow fiercer. As my colleague Jeff Monaghan reported in Are You Prepared for the Coming IT Staffing Crisis?, the number of US employers reporting difficulty filling open IT positions jumped from 14% in 2010 to 52% in 2011. This trend mirrors what we are seeing at ATR and what we are hearing more and more often from our clients. It is getting tougher and tougher to find the right people and many companies find that their IT positions linger unfilled for months.