Software // Information Management
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8/11/2008
11:47 PM
Rajan Chandras
Rajan Chandras
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Recessionary Winds Threaten IT

It's a disquieting thought, but signs are that 2009 may be the worst year for technology workers since the dot-com debacle... According to a survey of top CIOs by Goldman, Sachs & Co released last week, IT staff jobs are at increasingly at risk, both for contractors and in-house workers. Global services companies will also feel the pinch because of the slowing economy.

It's a disquieting thought, but signs are that 2009 may be the worst year for technology workers since the dot-com debacle. A recent poll of economists suggests that things will get worse before they get better - at least where the U.S. economy is concerned.

The survey - 50 economists polled by the Blue Chip Economic Indicators newsletter - expects the air to go out of the economy as the temporary lift to consumer spending (tax rebates) fades, and predicts that the sluggish economy will push the jobless rate to 6 percent in December and to 6.1 percent by the end of next year. The last time the unemployment rate was as high as 6 percent was in October 2003.Consumers are getting frugal again. The roughly $100 billion that the U.S. government sent to households to try to prop up the economy provided two months of decent spending gains in May and June. Figures due this week are likely to show the money started to run out in July, with consumers once again buying just the essentials.

Influential economist and New York University Professor Nouriel Roubini believes that the US is "in the second inning of a recession that will last for at least 18 months and help kill off hundreds of banks." Taxpayers will pay a big price - between $1 and $2 trillion - for helping bail out the rest of the financial services industry.

Almost all major industries - automobiles, communications, financial, manufacturing, pharmaceuticals, retailers - have been suffering from slowdown for some time now (of course, Big Oil excluded).

It seems like there is a bit of silver lining - Cisco sees challenges continuing well into next year, for example, yet sees "progress in the U.S. enterprise market" - but frankly it is difficult to see this cup as half-full.

But it's not just the broad economy that is at risk.

According to a survey of top CIOs by Goldman, Sachs & Co released last week, IT staff jobs are at increasingly at risk, both for contractors and in-house workers. Global services companies will also feel the pinch because of the slowing economy. CIOs anticipate cutting contract IT workers, staff from third-party service providers and even some of their own in-house staff.

Of course, we don't need CIO's to break this bit of bad news, do we? If business is hurting, consumers are hurting, the government is hurting, and our banks are hurting, it stands to reason that across the country, technology will be taking back-seat to thrift; spending to survival.

It is the time to take a deep breath and hunker down for a gritty eight to 16 months ahead. For a vast majority of technology workers, job-hopping at this time will be a lot like changing seats on a fast-moving roller coaster. Better not take the chance.It's a disquieting thought, but signs are that 2009 may be the worst year for technology workers since the dot-com debacle... According to a survey of top CIOs by Goldman, Sachs & Co released last week, IT staff jobs are at increasingly at risk, both for contractors and in-house workers. Global services companies will also feel the pinch because of the slowing economy.

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