Retaining skilled workers is IT execs' top concern, Luftman says
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The market for IT professionals is still the fastest-growing sector in the U.S. economy, with more than 1 million new jobs projected to be added between 2004 and 2014. Six of the 30 occupations projected by the Bureau of Labor Statistics to grow the fastest in this time period are IT related. IT job prospects are expected to be good as demand increases because of rapid advancement in technologies, new business opportunities for leveraging applications, and the number of baby boomers expected to retire.
But there may not be sufficient IT talent to meet this growing demand. The IT hiring downturn during the early part of this decade and the fear of offshore outsourcing have caused a drop in enrollment for computer science and information systems courses at many universities. In the past decade, the number of students majoring in computer science has dropped 40%. A report from UCLA's higher-education research institute shows an even steeper decline of 70% between 2000 and 2005 of freshmen who planned to major in computer science. The loss of IT skills and IT professionals will only accelerate the shift of IT jobs overseas. If nothing is done to turn this trend around to meet the anticipated strong demand for IT workers in the United States, organizations will be forced to source their IT resources overseas, reinforcing a self-fulfilling prophecy that everything is moving offshore.
HEAD COUNT, SALARIES ON THE RISE
Harris Interactive reports that, in the second quarter, organizations moderately increased IT head count and salaries to attract and retain skilled and talented IT professionals. In the current employee-driven market, it's difficult to retain talented IT professionals, who have historically displayed high turn-over rates.
The turnover of skilled IT people is expensive and disruptive to organizations. Whenever a talented professional leaves, costs are incurred for hiring and training, as well as the cost of losing the professional's knowledge about his or her company. Recruiting and hiring IT professionals isn't cheap. The cost of hiring skilled IT people varies depending on the type of job and the specific skills required, along with other intangibles. Gartner estimates that IT employee replacement costs are 2.5 times the annual salary of an IT professional leaving the organization. Recruiting includes the cost of advertising, recruiters, traveling, interviewing, and training, as well as the productivity lost as the new IT professional comes up to speed.
Retaining IT professionals has taken on a new sense of urgency. Important considerations such as how to retain skilled IT professionals in the improving IT job market, how to prepare for offshore outsourcing, and how to ensure that IT professionals have the required business, technical, and interpersonal skills to succeed in the era of globalization are all important.
The autonomy and flexibility IT professionals have in performing their jobs is also important for retention. IT professionals need to constantly update their skills to position themselves for opportunities to advance within their careers, as well as to ensure that IT staff is prepared to apply emerging technologies effectively to meet business demands. Organizations that provide education and training with options for improving both technical and business skills are on the right track. No matter how much salary a company pays, if IT professionals don't see opportunity for leveraging their skills or for career advancement, they're sure to look for greener pastures.
Companies also should pay more attention to factors affecting the work-life balance of IT professionals and offer a rewarding environment that ensures an appropriate equilibrium. IT professionals should be given flexibility in their work schedules, the ability to work from home, desirable amenities, greater benefits, and generous vacation and holiday packages. These perks go a long way in enhancing morale.
In sum, the economy is good, opportunities to leverage IT for business value are on the rise, and careers in IT are clearly promising for the foreseeable future. But unless IT careers are valued and promoted to create a pipeline of new talent, companies will be forced to source their IT head count demands overseas.
Jerry Luftman is associate dean of graduate information systems programs and a distinguished professor at Stevens Institute of Technology; he's also VP of academic affairs for the Society for Information Management. Rajkumar Kempaiah is a Ph.D. student at Stevens.