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1/24/2006
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I.T. Hiring Heats Up

Dramatic shifts in the candidate market could soon have organizations competing fiercely to attract and retain top talent

Most observers agree that IT workers' employment prospects have improved since the dot-com bust. But by how much? Depending on whom you ask, the job market is A) promising, B) hardly worth pursuing, or C) somewhere in between. Unfortunately, industry data doesn't help much—there are statistics to support nearly every position. Optimists cite reports from government agencies, trade groups, and the media regarding the possibility of a new technology boom. Pessimists, meanwhile, point to continuing IT layoffs, offshoring, and other cost-cutting moves that ultimately shrink the corporate-technology job pool.

In-demand Skills At Robert Half Technology, my colleagues and I are convinced that a fundamental shift is indeed taking place. In both our research and our everyday interactions with hiring managers and applicants, we see real evidence that the IT job market is increasingly being driven by the candidates themselves, though employers remain selective about whom they bring on board. CIOs and other IT hiring managers must acknowledge this shift, and modify their hiring and retention strategies accordingly.

The need to install wireless networks, replace aging equipment, comply with government regulations, and pursue Internet-related business opportunities is spurring many companies to move ahead with IT staffing plans. Yet those same companies are choosy when it comes to hiring full-time IT workers. They're focusing on highly skilled candidates in select specialities, including Windows administration, wireless network management, SQL server management, and Cisco network administration (see chart, above).

Our research finds a gradual increase in IT hiring. According to our most recent quarterly IT Hiring Index and Skills Report, there's been an incremental hiring buildup in the past six quarters. During this period, the share of IT executives planning to add staff has risen from a net 5% of those surveyed to a net 12%. The net hiring increase/decrease is calculated by subtracting the percentage of CIOs who plan to cut staff from the percentage who plan to add staff. While this is a far cry from the level of activity we reported during the late 1990s, when our surveys revealed net hiring increases in the 30% range, it still represents a significant improvement: During the first few years of this decade, the net had dropped as low as 3% (see chart, below).

On The Rebound In addition, research conducted in September 2005 for our 2006 Salary Guide finds that most businesses expect to increase IT hiring this year. It also shows that starting salaries for many IT positions are rising. For example, we expect 2006 starting salaries for IT auditors and lead application developers to increase by 11.2% and 5.3%, respectively, over last year. But while both hiring and salaries are on the rise, the operative phrase is "for some positions only."

Even when job candidates have experience and skills in the highly desired areas, many hiring managers are demanding more. IT is viewed by most senior executives as a strategic asset, and many business processes are indistinguishable from the underlying technology that supports them. As a result, hiring managers now seek IT practitioners who not only have a solid grasp of technology, but also understand how IT can help a company meet its most important business goals. And because many IT solutions are industry-specific, many hiring managers also want tech workers with experience in the hiring company's industry.

Moreover, some companies—particularly those that got burned during the '90s—aren't hiring at all. This feeds into IT workers' feelings of doubt and uncertainty.

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