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The number of IT jobs advertised in the first quarter has fallen by 40% on the same period last year to 19,500 - its lowest level for seven years - as employers cut jobs or freeze recruitment.
For the first time the demand for IT professionals with Internet skills has fallen drastically, adding to the picture of gloom within the jobs market, the latest SSP/ Computer Weekly recruitment survey shows.
But recruitment in the public sector looks better. Here organisations are stepping up IT recruitment as local authorities, government departments, the health service and the police, struggle to meet e-government targets.
IT suppliers are bearing the brunt of the slowdown, with hardware and software suppliers cutting recruitment advertising by half.
The number of jobs offered by IT companies fell to below 11,000 for the first time since the SSP/Computer Weekly survey began in 1994. Software house recruitment fell to less than 7,300, its lowest ever.
The sharp falls in the value of high-tech shares on international stock markets and stagnating growth in the US and Japanese economies have added to pressure on IT suppliers to cut recruitment.
The downturn for IT users has been less dramatic, with firms cutting their job advertising by a quarter compared to the same period last year.
The impact on the engineering sector has been particularly acute, with recruitment down two thirds from a year ago. Demand for IT staff in manufacturing remains stagnant, with little change compared to the first quarter of last year.
"These companies probably recruited heavily for Y2k to get their systems sorted. Now they are going back to their old ways - minimum IT recruitment," said Antony Millar, Ovum Holway analyst.
After months of record growth, demand for Internet skills has fallen for the first time as the UK catches the tail of the dotcom crash.
The number of adverts for generic Internet expertise fell by 16% in the first quarter compared to last year. Demand for HTML skills has fallen by over half - more than any of the top 25 skills apart from desktop windows and Cobol.
Although the number of jobs advertised for Wap and Corba skills rose, they are still at the bottom of the skills league table.
Across all industries, demand for development staff has fallen by half. Jobs for analysts are down by 43%, programmers by 48%, general purpose developers by 49% and database developers by 49%. Networking professionals have fared better, with only a 10% drop in demand for their skills, compared to the same time last year.
Some skills and sectors are bucking the trend. Advertising for public sector IT jobs has also risen by 12% over the year to 1,160 in the first quarter, its highest rise since 1998.
Demand for XML skills is growing, with the number of advertisements trebling from the same period last year. XML has risen 20 places in the Computer Weekly/SSP skills table over the past 12 months, as more companies begin to see it as the standard for e-commerce.
The survey does not take account of jobs advertised on the Web, suggesting that the downturn for IT suppliers who favour that medium may be less than the figures imply. Experts predict that the jobs market will take two or three years to recover.