2004 staffing outlook

While all signs point to an improving economy, IT staffing is only expected to experience miniscule growth this year. According to a report from Forrester, the average company plans a .3% in total IT staffing in 2004.

Forrester surveyed 818 IT executives from North American companies about their IT plans for 2004 as part of the analysis firm's Technographics Benchmark Study, which also covers IT spending. Of those surveyed, 61% of respondents plan to hold the line at current staffing levels. Some 22% expect to increase full-time IT staffing in 2004, 15% plan to reduce IT headcount, and 2% don't know yet.

What's more, firms planning changes say they won't be big ones. Only 7% of companies of companies plan increases or decreases of more than 10%. As you might expect, those industries planning the largest IT budget increases are the same ones with the most positive staffing outlook for 2004. The Forrester survey shows that the insurance industry expects to increase the IT staff by 1.5%, while retail should see a 1.3% gain. The services sector plans for a 1.1% IT staffing gain.

Respondents from other industries are bracing for more reductions. The primary production and supply sector expects staffing cuts of 1.2% this year, and utilities may reduce IT staffing levels by 1.1%.

Given the fact that IT staffing overall won't change much from 2003, companies are concerned about skills gaps. When asked what skill sets are lacking in their organizations to the point that it threatens success in 2004, IT leaders most frequently cited packaged applications expertise. Speed and customer responsiveness and project management were also cause for concern.

In order to address these skills gaps, 52% of respondents expect to use a combination of internal training and contracting. In fact, companies reducing IT staff were 56% more likely on average to outsource for the first time than companies not cutting headcount.

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