Of 385,488 online job vacancy advertisements surveyed in September, vacancies in the IT sector fell 3.27 percent in the month.
September was the fourth consecutive month of decline, and saw the overall Olivier Job Index fall 1.17 percent in the month and 2.03 percent in the year to reach a five-year low.
A year ago, IT was the second largest job sector after Sales and Marketing. It has fallen behind Engineering, Trades and Services, and Building and Construction to be ranked fifth.
“I've been surprised at how poorly IT has performed,” said Olivier Group’s Director, Robert Olivier, noting that IT has experienced the second largest fall during the past year, after the Banking and Finance sector.
“In a year it’s gone from a sellers market to a buyers market. It’s been a slow painful decline -- a death by a thousand cuts.”
“I think this is because banking and the public sector are big IT users and demand has fallen. Also, many Australian operations are part of US global businesses and the squeeze is coming from head office,” he speculated.
Although the ‘innovative spirit and drive’ is unlikely to be lost, a decline in the availability of venture capital cash and monetary investment could curb commercial development, Olivier said.
Meanwhile, he expects employers to be gambling on how long the economic slowdown will last by cutting back on temporary staff and contractors, and graduate hires.
Job advertisements for temporary staff and contractors fell 4.7 percent in September and 14.3 percent during the past year. Meanwhile, advertisements for graduate positions fell 2.2 percent in the month and 16.03 percent in the year.
“There’s no point letting people go if you’re going to have to rehire in 12 months or less,” Olivier said, highlighting the security of permanent positions so far.
“But if employers see the problems lasting longer, then we’ll see a rise in the jobless rate,” he said.
For the younger generation of employees and job hunters, there may be tough times ahead, as the falling value of superannuation and investment funds may lead mature workers to defer retirement, and in some cases, bring people out of retirement.
“When employers become more careful about whom they employ and supply exceeds demand, job tenure becomes a critical factor,” Olivier said. “In the 2001-2 downturn, we saw employers penalising the job hoppers.”
“They [Gen Y] have never experienced a contracting labour market and with all the talk of an aging population and skills shortages perhaps were not expecting it either!”
Olivier said workers should consolidate with one employer, and make sure that they are considered core staff and high performance / low maintenance.
He said the global economic slowdown could put an end to part of the widely-touted skills shortage. However, he noted that demand for staff in some sectors will be stronger than in others.
“If the global meltdown gets worse or stays for longer then overall supply will exceed demand and some of the shortage will be over,” he said.
“But it’s also important not be generalise and to consider matters on an occupational basis,” he said.
“Healthcare, mining and engineering will continue to have shortages, but there will be a lot of pain in financial services, IT and a wide range of white collar professions.”
Poor IT performance surprises job market survey
By Liz Tay on Oct 8, 2008 1:53PM