IT training demand drops

Training for vendor certifications is down by as much as 25 per cent, according to one of Australia's largest IT training companies. Such news doesn't bode well for vendor training partners, as the industry prepares for ashake-out.

"You have to look at what the drivers are for training, and that is technology deployments. There is a direct correlation, so if deployments are down, training is down," said Dimension Data Learning Solutions general manager Steve Ross.

"This time of year, coming into Christmas, is always down," Ross said. "But I'd say vendor training is down by around 25 per cent."

The news follows the general downturn in the IT sector. With major staff cuts now a daily occurrence, remaining staff are being forced to work harder -- time out of the office to go on a training course is just not feasible.

"Businesses are trying to reduce costs, and when they look at the discretionary spend, and what do you have? Travel, marketing and training - training gets underlined three times," said Ross. "At this time of the year, the payback for training is difficult to quantify."

Andrew Major, channels and alliances manager at one of Australia's largest private training companies Spherion, said the situation has forced changes in the way training partners are offering courses. While the demand for commercial training stagnates, Major said Spherion is finding growth in customised training offerings.

But he warned of a price war ensuing between training companies. "There are companies out there that are, diplomatically speaking, offering very 'competitive pricing'. One company won a large bid recently because it cut its price by 40 per cent," Major said. "It can't make money on that, but some are just happy to keep their cash flow ticking over.

"Unless there is a major change in the industry, and I don't think anyone is really expecting it any time soon, then we're heading for a major shakedown in the top-tier training companies, with many of them either folding or being eaten or announcing they're no longer going to be playing in that space. It seems inevitable."

The downturn in commercial training isn't reflected in career-based training, according to Peter Scope, business development manager for e-learning at Cisco. The networking giant has 5938 students currently enrolled in its Network Academies program, which offers Cisco Certified Network Associate courses in TAFEs, universities and high schools across the country.

The Network Academies program had 570 first-year students enrolled last year; this year that number jumped to 2423.

Scope said there is still a "skills shortage" and that there is a growing number of students considering a career in IT, as well as current IT professionals looking to re-enter the workforce after being laid off.

Dimension Data's Ross agreed. He said most people laid off in the IT industry so far come from vendors and the channel. Meanwhile, large organisations that are dependent on IT are not letting go of their IT staff.

"People are deferring training, but there's still a heightened need for skills," Ross said.

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