IT employers shun agencies and go direct

Tentative signs of life appear to be emerging on the IT jobs front; however, it appears employers are cutting employment agencies out of the loop and recruiting directly.

SAP outsourcer Oxygen, a wholly-owned subsidiary of Carter Holt Harvey (CHH) has announced it intends to put on 34 new IT-related staff in total as the operation continues to expand. Positions up for grabs include SAP specialists for Oxygen's manufacturing and finance modules as well as its technology and operations groups for project management and infrastructure management. Staff will increase from 265 to 300 - all without a penny for languishing IT recruitment firms.

Oxygen CEO Mike Smith says the recruitment drive is necessitated by an expansion in non-CHH related contracts which have escalated to 28 new external customers in 15 months, coinciding with a push from 'second tier' players stepping up to seize customers from larger incumbents with higher overheads.

"Tier one powers have been merging and rebranding and so on . . . our clients look at us as young, fresh, flexible and well-priced. We come from a business, so we have a lot of ground with people who understand our business - which is manufacturing and finance based," Smith said.

Smith says the decision to bypass an agency - even for the large number of positions he is offering, is because current flat IT labour market conditions negate the value agencies traditionally offer.

"It's a reasonably depressed market at the moment . . . there are a bunch of people around. We can target the people we want quite easily, so there is no point in us using an agency for that. We're getting great people," Smith said, adding the direct approach brings agencies to his door regardless.

"We've had a lot of approaches from recruitment agencies as a result of the ad . . . but we'll pull the rake through the market ourselves. These guys [recruiters] all say they have the perfect candidates, but when you dive into it, they're not exactly sure what we need and they expect us to give them a full briefing. They're looking at the same people [we are] and [most candidates] have their names down with several agencies. It's pretty tough out there," Smith said.

For IT professionals who are hunting for a job, Smith - the first to concede just how tough times are – feels a mix confidence and realism are essential.

"Try and retain as much of your confidence as you can and be as open-minded and flexible as you can. Be realistic about the landscape changing – moving to different models of supply," Smith says.

Online job market as clear as mud

If the current state of the IT jobs market seems on the lacklustre side of confused, that's because it is. Little comprehensive or qualitative data exists or is purposely collected to track IT jobs on a monthly or seasonal basis, and what there is resides within broad surveys such as bank economist Saul Eslake's ANZ's 'Job Ads Index' or recruiter Bob Olivier's 'Internet Job Index'.

Neither cover IT well, although it should be noted the ANZ product covers IT employment by default rather than design as part of a broad take of the employment landscape. It has strict seasonal adjustment, is a Reserve Bank Indicator and has substantive history to clock longer cycles and trends. The ANZ methodology for sampling is simple. If you are prepared to pay cash for a print ad, then there is likely to be a real job at the end of it. It's just that sometimes the IT jobs are lumped in with all the others.

Bob Olivier's 'Internet Job Index', on the other hand, is the upstart on the job data block. Of late, Olivier has taken to hitting the ANZ with a stick, claiming there is a mass migration of employers from print to online advertising. Olivier actually goes out of his way to monitor IT, as it is exactly this sort of high-value sector that makes for a recruiter's bread and butter. It's a good idea, but run by a recruiter it's a mess.

How many of these ads are from IT multiple recruitment agencies touting a single employer is hard to tell. Even harder is which agency ads merely mirror the others in the hope of capturing candidates. Olivier's latest results show a small positive bump in what is clearly a sector that is, according to his data, flat-lining.

But perhaps the biggest in the Olivier data confusion stems from the lumping of IT managers into the same lot as vendors sales people - two very different roles counted in the same lot, with very different remuneration criteria. There's a lot of data, but it means very little, the complete reverse of the ANZ scenario. It's against this background that the recent spate of online recruitment bubbles need to be viewed. It's also very likely the reason Mike Smith bypassed the recruitment agencies altogether.

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