Tech giant layoffs will not impact IT Job Market growth
November 07, 2022 (PRLEAP.COM) Business NewsPark City – UT – www.e-janco.com – Janco reports that October saw a noticeable increase in the number of new IT jobs created. Most of those positions were in non-management positions. 15,300 new IT jobs were added to the IT job market in October along with an increase by the BLS for the prior two months of 13,700 jobs.
According to the latest BLS data, analyzed by Janco, there are now 3.98 million jobs for IT Professionals in the US. For 26 months in a row, there has been an increase in the number of jobs added to the IT job market. Janco sees this trend continuing but at a much slower pace. Layoffs are tech giant companies will continue. Musk said his layoffs were due to excessive management with 10 managers for each "coder".
Janco has increased its October forecast for IT job market growth to 188K from 179K in its September forecast for CY 2022. That will be less growth than in 2021 but still at record-high levels.
The CEO of Janco, M. Victor Janulaitis said, "Based on our analysis, the IT job market and opportunities for IT professionals will continue to be positive but not as broad in scope as in the first three quarters of 2022. CIOs and CFOs are looking to improve the productivity of IT. That means they are focusing on eliminating "non-essential" managers and staff. They will continue to hire coders and developers. The highest demand will be for programmers, blockchain processing, and security professionals. Much of the hiring will be limited to filling positions which have been approved and are un-filled — not staff expansion."
He said, "CIOs and CFOs see dual challenges of Inflation and an economic downturn. Work from home will be limited or eliminated for most positions. They are reluctant to hire replacements at salaries that are significantly higher than those who left. At the same time, they have to address the inflationary pressures faced by employees. We believe that salaries for IT Pros in 2023 will be 5-6% salary above existing levels. Salary compression has occurred from the earlier hiring efforts with new employees being paid more than existing employees. That has impacted existing employee morale due to the inflationary status that the US economy is in. The move by the tech giants to improve productivity by laying off middle layers of management will not impact programmers and developers. Rather they will increase the span of control (number of people who report to each manager and supervisor) of managers and supervisors who remain and reduce the number of layers of management between the top IT executive and the lowest level of coders and developers."
Janulaitis said, "Most of the issues faced by the economy are due to supply chain problems. If China opens up and supply chains will improve. That should lessen the recessionary pressures that are driving the tech giants to reduce staff. Also, the results of the election in the US will provide an opportunity to improve the economic climate.
The CEO added, "In our Mid Year 2022 IT Salary Survey, we have found IT salaries for existing IT staff and middle managers increased by just under 3% while new hires were paid 5-6% more than existing staff. In conversation with several CIOs, we observed that starting pay rates for new hires were in the 8-10% range a few months back, but this is not the case currently."
Janulaitis said, "CIOs and CFOs now are more cautious than they were in the first three quarters of the year. CIOs do not yet have a clear understanding of how a downturn will impact their bottom line. Most still are hiring but at a slower pace. With all that, the IT job market remains tight with an average of 200,000 IT professionals' jobs that are not filled due to a lack of qualified candidates. The number of unfilled IT jobs has peaked from over 260K in April to close to 200K in September. That should still be enough of a buffer to keep hiring IT pros on a positive track."
Janco is an international consulting firm that follows issues that concern CIOs and CFOs and publishes a series of IT and business infrastructure HandiGuides® and Templates including detailed IT Job Descriptions, IT Infrastructure, Policies and Procedures, Disaster Recovery/Business Continuity Template, Security Template, and its semi-annual IT Salary Survey.