Anyone scanning the headlines of the daily newspapers could be forgiven for thinking that the Irish IT industry has shut up shop, but clearly this isn’t the case.
According to experts in the IT recruitment field, 2003 is expected to be significantly better for the jobs market than 2002 and while much rationalisation has taken place in the market, the general consensus is that the hardest times are over.
“The fourth quarter of 2002 has been a settling period for both indigenous and multinational companies. Adjustments have been made and most companies are now planning for realistic growth in 2003. We are relatively confident that the recruitment market will pick up in the coming year,” says Aaron O’Brien (pictured), client services director of Computer Placement Limited with CPL Resources.
CPL Resources was set up in 1989 and has seen many developments in the IT sector over the last 13 years. “Our experience was that the demand for skilled IT personnel in 1999 and 2000 reached new heights, as did wage inflation. Following 2001 and all the changes that took place, it is now very much an employer’s market,” says O’Brien.
“In the past where there was a lot of competition around salaries and packages, we are now seeing companies move back towards a heavy focus on their selection and salary negotiation procedures,” he comments.
While there has been massive upheaval in the market, it is important to remember that from a recruitment perspective, there is really no such thing as an IT sector. Instead, there are thousands of companies in hundreds of industries, all with IT requirements.
Some may be traditional technology companies such as software houses or even internet businesses, but many more are banks, financial services firms, supermarkets and manufacturers. While none of these can be described as IT companies, they all have IT staff on the books and they are all planning on growth in 2003.
“Every single company in Ireland uses technology in some way, but obviously they are not all in IT. “There have been considerable challenges in the IT sector in the last two years, but the large multinationals remain pretty solid and they still have IT functions that have to be fulfilled,” says O’Brien.
Adrian McGennis, director of IT recruitment specialist Sigmar, shares this upbeat view. “Large companies in non-IT sectors are still out there and they still need to perform. They all have information and communication technology departments and they are still hiring staff in these areas and to expand their enterprise resource planning and customer relationship management systems.”
According to Sigmar, those industries currently hiring and likely to continue to do so into 2003 include the pharmaceutical and healthcare sectors, as well as banks and financial services companies, call centres and construction companies.
“It is obviously true that demand has dropped significantly in the IT sector, but that drop has slowed and has probably bottomed out at this stage. It is tempting to compare our current position to that of two years ago and of course there is far less demand, but in absolute terms there is still reasonable growth,” says McGennis.
According to CPL Resources, there are still more candidates available than before and hence the urgency around hiring has disappeared. “Companies have had a settling period and are now making hires on a much more strategic basis,” O’Brien reckons. “As a consequence of that, there is a demand on recruitment providers to be more selective in how they put curricula vitae to their clients.”
He continues: “I am not convinced things have been as bad as they have been portrayed in the media. In our experience, any reduction in the number of permanent positions in the Irish IT sector has been balanced out by the increase in the flexible working contracts.
“There is a need to manage and maintain infrastructure for customers and that need is as critical as it ever was. Companies are looking at more flexible staffing arrangements, whether that be temporary or medium-term contracts.”
CPL Resources forecasts strong demand for specialist skills in the mainframe client/server environment. And one significant development noted by O’Brien is a move from permanent to medium-term contracts for IT staff.
“We are calling this a normalisation in the market. There has been a resetting of expectations that are much more realistic around salaries and the time an employer needs to take to make a hire. It takes time,” explains O’Brien.
Eden Recruitment’s David Doran agrees that things are looking up. “We expect 2003 to be significantly better than 2002,” he says. “Already there are parts of the market that are thriving and at the moment, it is the traditional workforce environments that are hiring IT staff. Pharmaceuticals and call centres are particularly busy with demand for specialist IT and language skills.
“While the downturn obviously effected the industry badly, there are roles that regularly pop up for people with various skill sets. There was so much over staffing previously that we have gone through a stabilising period and we expect it to pick up sooner rather than later. It is simply not true that here are no IT jobs out there,” he says.
“The kinds of companies recruiting at the moment are the traditionally conservative employers, such as the banks, business and financial services companies and even more mainstream companies supermarkets and other large retailers,” says Doran.
By Alex Meehan