Will low-cost offshore competition and packaged apps make the in-house programmer obsolete?
Coding software has been a good living for a half million or more--sometimes far more--Americans during the last decade. Now it's the IT job category that bears the highest unemployment rate, at 7.1% this year. Low-cost global competition and changing technologies have dimmed the career prospects of many programmers in this country and cast the role's future into doubt. To programmers like Kevin Mueller and Garrison Hoffman, these grand economic changes are as personal as a paycheck.
Hoffman had it made. In the late '90s, he pulled in $80,000 a year programming at a consulting firm that developed systems for pharmaceutical companies. But the paycheck didn't begin to explain the allure of writing code. "It's like working on puzzles for eight, 10 hours a day," Hoffman says. "You're constantly learning, finding new challenges, new riddles. And I got paid for that."
Not anymore. Hoffman hasn't had steady IT work in two years. He gets by with temporary jobs as a systems administrator and photographer and recently moved from fashionable Park Slope in Brooklyn, N.Y., to nearby Bay Ridge, the more solidly middle-class neighborhood featured in the John Travolta film "Saturday Night Fever."
Mueller codes for stock-exchange Archipelago working with business managers in a craftsman approach
Photo by Jeffery Salter/Redux Pictures
Kevin Mueller has it made. His employer, the fast-growing stock exchange Archipelago, lives on business technology. The speed and reliability of Archipelago's electronic-trading platform are the reason traders use it. Mueller works side by side with business-unit managers who know the value of good code. But would he advise a smart 18-year-old to study computer programming? After a long pause: "For the majority of folks, I'd tell them not to do it," he says.
Even Mueller's best-case scenario of the future is a world with fewer programming jobs. Smart companies will take Archipelago's "software craftsman" approach, he says. Small teams of talented programmers who understand the company work closely with business managers to craft code that solves problems. But Mueller knows many businesses will go the other route, throwing huge programmer teams with layers of project managers at problems. Those are the commodity programming jobs most likely to be shipped offshore. "It's going to be a shrinking field," Mueller says.
That appears to be what's happening. U.S. workers are exiting the field: From 2000 to 2002, the number of IT pros calling themselves computer programmers dropped more than 12% as 87,000 people walked away from the career. It's no wonder--the number employed dropped 16%. In 2003, there are 3% fewer people employed as programmers than in 1994. Unemployment among programmers averaged 1.6% two years ago, a far cry from 7.1% in the first nine months of this year, the highest of the eight IT job categories tracked by the Bureau of Labor Statistics. That unemployment comparison isn't perfect, since the bureau began using new job definitions in 2003, but for both categories the government used monthly surveys counting coders employed by user companies, IT vendors, outsourcers, integrators, and consultancies, plus the self-employed.
Even as their numbers shrink, 16% of IT employees--one out of every six--still make their living as programmers. The future course of this job will tell a lot about how business computing in general evolves.
The inescapable fact is that most companies simply don't need as many programmers as in the past. And when they do, they have many lower-cost options around the world. Companies that develop and sell software still need armies of U.S. programmers, but Hewlett-Packard, IBM, Microsoft, and other big companies are increasingly building large development staffs in places from India to Ireland. Yet change is most striking for the in-house programmer who helps make a company run.
Not long ago programmers were the essence of IT. They were critical knowledge workers before the term gained popularity, and programming was the starter job of many business-technology leaders. Contrast that with today: Companies treat programming as a capability that's best bought on an as-needed basis. In some circles, that's given the profession a bad rap. "Many IT professionals wouldn't call themselves programmer," says senior VP and CIO David Guzmán at the medical-supplies distributor Owens & Minor Inc. "It's an anachronistic term with a pejorative context to modern IT professionals."
The Business of Going DigitalDigital business isn't about changing code; it's about changing what legacy sales, distribution, customer service, and product groups do in the new digital age. It's about bringing big data analytics, mobile, social, marketing automation, cloud computing, and the app economy together to launch new products and services. We're seeing new titles in this digital revolution, new responsibilities, new business models, and major shifts in technology spending.
What The Business Really Thinks Of IT: 3 Hard TruthsThey say perception is reality. If so, many in-house IT departments have reason to worry. InformationWeek's IT Perception Survey seeks to quantify how IT thinks it's doing versus how the business views IT's performance in delivering services - and, more important, powering innovation. The news isn't great.