Whenever there's a shortage of staff, wages rise, turnover increases and quality declines as companies hire less-qualified applicants. Every economic indicator confirms this is happening today. IT staffs are being paid higher salaries than their business counterparts with equivalent educational and career backgrounds. Nearly 70 per cent of the organisations surveyed by Meta Group say they pay their IT staffs more than they pay end users.
Scarcities, whether in oil, steel, food supplies, switchboard operators or engineers, have never lasted too long. All forecasts that have extrapolated shortages into projections of chronic scarcities have always been proved wrong. This is particularly true when a sudden shortfall is caused by a combination of a cutback in supplies and a squandering of resources. The recent jumps in the prices of petrol and heating oil are good examples of this phenomenon.
Recent scarcities of plywood, orange juice, gold, wallboard and the metal palladium have shown similar patterns, but these shortages will be reversed as soon as higher prices bring supply and demand back into balance.
Current anxieties about the approach of an extreme IT labour shortage are ripe for such a reversal. Corporate executives are preparing to insist on fewer labour-intensive solutions to their software needs. Rising wages, increased turnover and declining quality won't be tolerated as the IT budgets keep creeping up to approach the size of corporate profits.
Enter the application service providers. As soon as ASPs can deliver reliable user support over networks, organisations will find that renting complete business solutions instead of constructing and maintaining their own home-cooked spaghetti code is an increasingly attractive alternative. There are already ASPs that can satisfy cross-functional systems needs, such as in enterprise-wide resource management in specialised market segments like automobile assembly, wholesale drugs and electronic merchandising.
The idea that each organisation must design its own computing infrastructure, master the adoption of technological innovations and maintain all software enhancements is obsolete.
Many IT executives will be sitting down soon to draft their long-range plans. If they propose large salary increases to compensate for the prospect of a gruesome labour shortage, business executives will demand alternative solutions.