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IT Misses Out On Job Growth

Bureau of Labor Statistics figures show that while U.S. businesses added employees last month, employers in computer-systems development and support services actually cut jobs.
Though American companies added employees last month at the fastest pace in more than three years, one class of employer--those providing computer-systems development and support services--retained fewer workers.

Companies that provide computer-system design and related services employed 1.1 million workers in January, 600 fewer than in December and 11,000 fewer than January 2003, according to a survey of employers issued Friday by the Bureau of Labor Statistics. By comparison, all nonfarm businesses added 112,000 jobs last month.

Since peaking at 1.35 million in March 2001, the computer-systems development category has lost 245,000 jobs, an 18.2% decline. Jobs in this category are hovering at their lowest level since April 1999. The figures are seasonally adjusted; the December and January numbers are preliminary and subject to revision.

Offshore outsourcing could be partly responsible for the decline in computer-systems development jobs, suspects Labor Statistics economist Rachael Krantz, though she adds that the bureau has no concrete data to support or dismiss that notion. There's been "some talk" within the bureau of conducting a separate study on offshore outsourcing as citizens raise questions about the matter, she says.

The jobs classified as computer systems design and related services are traditional IT positions found in consulting, outsourcing, and integration companies. But they also could include jobs situated in separate IT units within companies producing other types of products and services. For instance, jobs found in an IT subsidiary that supports a large consumer manufacturer could be included in this category.

Jobs in the computer-system-design category represent about one-third of all IT jobs when compared with another government survey. The Census Bureau each month surveys households in the study that Labor Statistics uses to determine the monthly unemployment rate. An InformationWeek analysis of the household survey data estimates the IT employment at about 3.2 million workers at the end of 2003. Overall unemployment in January fell one-tenth of a percentage point from December to 5.6%, the lowest rate since the 5.4% posted in October 2001. The Labor Bureau doesn't break out a separate unemployment rate for IT workers, though an analysis of its data showed that IT unemployment in 2003 stood at 5.6%.