A crisis of quality not quantity: the UK IT Skills Market

I have tracked IT recruitment advertising for over 30 years to compare what is happening in the market place with predictions, before it shows in official statistics, if at all . 25 years ago I stopped collecting my own data in favour of using Salary Services Limited . Their report for Quarter 2 2008 has, as usual, helped make sense of apparently conflicting evidence.


Quarter 2 2008 saw the sharpest drop in recruitment advertising in a decade and average salaries are falling to keep pace with inflation, and in some cases falling in nominal, let alone “real” terms. Meanwhile employers are complaining of skills shortages.


A peek behind the averages gives the explanation. For over 20 years the recruitment market has been dominated by agencies seeking generic (i.e not application specific) technical skills to use currently fashionable software products for clients. Their market share is now falling while direct recruitment by employers has held constant and may be rising.


Those complaining of skills shortages are those who rarely recruited via mainstream agencies in the first place – they increasingly want maths, physics and computer science graduates who can hold extreme complexity in their heads (whether for a global dealing system or an on-line computer game) or those who can mix business and technical skills to deliver systems that meet user needs. Instead of recruiting via the mainstream agencies they tend to use specialist head-hunters, seek out University departments whose alumni they rate and/or support industry forums which attract the kind of people they are seeking.  


The good news is that the Indians and Chinese have similar shortages. The bad news is that we are marching in the wrong direction – dumbing down our degree courses in the name of social inclusion and failing to enthuse and enlighten our brightest teenagers. Hence the OiI and Vinegar debate in this blog.


The gaps between the salaries on offer for those who have world class brains and/or the experience to match and those have to compete on price with their Indian peers is widening while the averages stagnate.


Unless we move rapidly to stretch and harness the best brains in Britain, including those already in the workforce whose skills are currently atrophying, the consequences will be terminal inside four years. We will have not recover from having to import most of the skills to handle the systems and communications needs for the Olympics: from information security and identity management to handle the convergence of criminal (let alone terrorist) attention on from London from around world, to implementing the convergence of fixed and mobile multi-media access for those watching the games from a safe distance.