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The IT project pipeline is filling up fast, but don't expect your employer to throw bodies at the problem. Social networking is hot but not always understood, tablets are earning begrudging respect, and data analytics is moving from a wonkish craft to a mainstream discipline.
We gleaned those findings and many more from our Outlook 2012 Survey of 605 business technology pros. Our data predicts that hiring freezes will persist next year at 30% of companies, even as internal demand for IT projects rises. Three-fourths of survey respondents now see demand rising for new IT projects, whereas barely half did in our Outlook Survey two years ago. Conversely, a mere 3% of technology pros say the demand for new IT projects is dropping at their companies. Two years ago, 19% of respondents to our Outlook Survey saw project demand declining. The upshot: Few business initiatives of any kind can move ahead these days without some IT implementation or innovation supporting or driving them, so this strong demand for tech projects bodes well for business expansion and investment overall.
Importantly, IT is getting money to execute on those projects. Fifty-six percent of respondents to our survey say their companies plan to increase IT spending in 2012, and just 16% think they'll cut. Two years ago, just 46% were increasing and 24% were cutting IT spending. This IT budget growth builds on last year's momentum, when we also saw the majority of companies increasing IT spending over the prior year.
IT Hiring: Still Skittish
Two years ago, the IT hiring picture was bleak: Just 14% of companies were expanding and 18% were cutting back. Today, 25% are expanding and just 9% are cutting back.
But the majority remain on the fence: 30% of the IT pros who responded to our Outlook Survey say their companies are still in a hiring freeze, and 36% are only filling openings for existing positions. Federal surveys of the U.S. workforce show IT employment is back up around where it was before the late 2008 and 2009 wave of layoffs, to around 4 million employed IT pros.
A number of reasons explain why increasing project demand won't necessarily lead CIOs to hire initially. CIOs continue to rely heavily on outsourcing as the variable component to their workforces, absorbing the peaks of IT demand as well as fulfilling specialized skills. For example, there's strong demand for mobile app development, but a lot of that work is outsourced because IT shops tend not to have those skills in-house. Cloud computing software lets companies add IT capabilities without the same staff needs as in the past, and cloud infrastructure holds the same promise. Highly virtualized data centers (private clouds) will drive more automation of IT operations. So while the IT job market looks likely to continue thawing if the economy keeps improving, new hiring will come slowly.