Nortel CFO quits after questionable transactions
- 12 February, 2002 12:52
Job hoppers may find their employment prospects drying up, while the devoted and the steady will win the IT employment race, say recruitment agencies.
Local recruitment specialists agree with findings of a US job index, which revealed that demonstrated loyalty is important to prospective employers and to companies making lay-off decisions in the current IT market. However, other factors also play a part in lay-off and employment decisions.
"Some 18 months ago loyalty was not such a high priority, because of the shortage of talented IT candidates. Now the roles haves reversed. Job shortages mean clients can pick and choose. It's quite refreshing," said Jonathon Morse, IT&T team leader, TMP Worldwide.
"If one candidate has been in five different companies over 10 years and another has been at two different companies for 10 years, but they are equal in every other respect, it will be better value and marginally cheaper to choose the one that has worked for fewer companies," Morse said.
Salaries skyrocketed for some job hoppers in the heady days before crash.com. He said there were IT professionals who switched companies during the boom days and managed to score lucrative and sometimes fairly "exorbitant" salaries while those that remained loyal to a few companies generally remained on a lower salary package. This factor can determine employment decisions.
Brian Walker, director, e-careeer employment services, said, "There aren't any good statistics, but anecdotally, it seems companies have been cutting under performers or less skilled employees first, but senior higher paid employees are also cut to keep the teams properly balanced.
"Loyalty seems to be a more important factor when there are skills shortages. When cutting back, employers tend to keep their best staff, irrespective of years of service," he said.
Prospects for unemployed IT professionals are not so rosy, according to Walker and particularly for young professionals in support roles. "We recently had more than 250 applicants for a help desk role," he said.
Key findings of the US study, from outsourcing firm, Challenger, Gray and Christmas:
- 26 per cent of those laid off from the 3000 companies surveyed had been employed for fewer than 24 months.
- In 1998, at the peak of the US labour shortage, workers between the ages of 20 and 34 stayed in one place for an average of 1.9 years, while workers between the ages of 35 and 54 stayed at their jobs for an average of 6.6 years.
- And, according to the US bureau of Labor Statistics, the unemployment rate for those between 20 and 34 was 7.9 per cent in January, while the unemployment rate for people between 35 and 55 was 4.8 per cent.
John Challenger, CEO of Challenger, Gray and Christmas, said the figures indicate a trend that runs counter to past recessions.
In the past, it was often higher-paid employees with a lot of tenure at a company that wound up being cut first, while younger, less-experienced and lower-paid employees were retained, he said.
In the Australian IT job market, other factors play a part in lay-off decisions. These include the skills of the employee versus the needs of the company, the ease of replacing personnel later on, rare skills not often let go, the outlook for future projects and the industry in general, according to Walker.
Eoin Joyce, partner at SelfCert and former IT professional, is currently working on the staff development and environmental policies within the IT training company.
"I can't imagine choosing one staff member to do a job over another because they can be paid less. I suppose that people might use that as an excuse to remove people who might be a little stale," he said.
"Loyal employees are an invaluable asset to any organisation. I could not understand a business that would cut a staff member because they were there for a long time or were being highly paid, just to save money. Obviously though, being highly paid and having a long history with a company does not equal loyalty by any means." - Brian Sullivan contributed to this article.
IT looking up
The Australian IT industry is on the way to recovering from the severe downslide it suffered after the September 11 tragedy, with 30 per cent of IT companies predicting hiring increases in the next quarter.
According to the TMP Job Index, only 8.2 per cent of the 6007 employers surveyed nationally intend to downsize, giving a net effect of 21.8 per cent.
This result is 10.3 percentage points up on the November 2001 to January 2002 quarter results.
Matt Gordon of TMP Worldwide said there will be plenty of core computer and IT vacancies available for those looking for jobs in this industry in the next quarter.
Gordon said South Australian IT employers are exceptionally confident about the future with a massive 75 per cent net effect.
This is 46.4 percentage points higher than the result reported in the previous quarter and a record result for the state.
"The ACT IT sector is also looking healthy with a net effect of 32.4 per cent reported. While NSW IT employers are less positive with a net of 15.1 per cent, it is still a decent increase in optimism over the last survey of 11.0 percentage points," Gordon said. - Lauren Thomsen-Moore.