The latest quarterly survey of IT jobs and salaries shows a second consecutive quarter of growth in the jobs market. These signs point to a continued recovery, writes Nicholas Enticknap.
The slow rise out of recession is continuing, according to the latest issue of the SSL/Computer Weekly Quarterly Survey of Appointments, Data and Trends. Jobs advertised in magazines, which reflect recruitment activity in IT sites most reliably, were well up compared with a year ago, for the second consecutive quarter following five solid years of decline.
IT jobs advertised on the web fell by just 5% over the last quarter of 2003, the smallest decline for more than three years. The contractor market is leading the recovery, with an increase in jobs of 25%. There was an increase in advertising for all types of contractor except software engineers, where demand fell by well over 33%. Demand for this type of professional was down by almost as much in the full-time market.
The overall improvement, though welcome, is small. Jobs in magazines are still less than 17% of the total registered as recently as the fourth quarter of 2000, and jobs on the web are well under 25%.
Cathy Walsh, managing director of recruitment agency Triangle, concedes that recovery still has a long way to go. "It was not a great quarter, but you can see the trend. For both permanent and contract staff, things are much more positive."
Paul Smith, group marketing director at Harvey Nash, has moved from the position of cautious optimism he expressed about the first signs of recovery last autumn. "We are much more vocal now in our confidence."
He goes on, "We are seeing much more activity, especially from 1 January, when people got their budgets and headcount allocations. There is more activity from employers and, as a result, more from candidates." But he adds, "I would caution that we do not expect a return to the growth of 1999 to 2000. We see a slow, mature growth in the market."
A notable feature of the last quarter was the increase in jobs offered by the software industry, which was above the market average in all areas. On the web, software houses accounted for 42% of all full-time jobs offered, and twice as much was invested in magazines than a year ago. Software house advertising was at its highest level for more than two years.
Software houses also increased their demand for contract staff by 33% over the quarter. As a result, there was a large increase in demand for consultants. Job offers on the web were treble the number of a year ago, while in magazines they increased six-fold.
Demand for systems staff was also up everywhere, a trend that was also apparent in the last survey. There were more contractor jobs offered to systems professionals than to any other category in the fourth quarter, nearly a third of the total.
It may be that development work will follow this renewed systems activity. Advertisements for developers increased in magazines and on the web. Demand for programmers fell on the web, but this is probably a sign of changing job labels rather because of a shift in demand.
Regionally, London showed up best, with jobs on offer both in the City and in the suburbs rising from a year ago. The only other area to show a rise was the East Midlands. North-west England, Wales, the West and Scotland all remained mired in recession, with jobs down by about 25% on a year ago in each case. In Scotland in particular, 2003 was a year to forget, with jobs falling more than in any other region in all four quarters of the year.
The recovery in recruitment activity has not yet resulted in a growth in salaries - it is still a buyer's market. Salaries offered to full-time consultants were an average of 9% down on a year ago, although they were slightly up on the third quarter of 2003.
One group of professionals who will be happier than most are IT directors. In the third quarter there was a sudden, alarming dip in the average salary offered to £72,000, but this appears to have been a statistical glitch, and in the fourth quarter the figure rose back to a more typical £87,000.
The average annual rise in salary across all permanent job titles in the last quarter was just 0.7% - the lowest figure recorded in 2003 - and well under the rate of inflation however it is measured (in November the official retail price index figure was 2.5%). Developers bucked this trend - the average rise for them was typically in the 4% to 5% range. For business analysts and PC support professionals the trend was upwards.
For contractors, the picture was uniformly rosier: the average rate was up 1.6%, which is the first time since the recession started that rates have risen. Rates for developers were, on average, up by 8%; for analyst/programmers 6%; and the average rate of increase across all systems posts was 7%.
Sought-after expertise is largely in new-wave 21st century software. Among the 25 skills most in demand on the web, 10 featured in more advertisements than a year ago, but only one of these, Sybase, could be regarded as traditional.
New Microsoft development techniques are rapidly becoming established as the norm, and two of these showed the biggest growth over the quarter. The C# programming language appeared in more than double the number of adverts than a year ago and has entered the top 20 for the first time, and .net appeared in half as many ads again and is up nine places on a year ago.
The other skill to show a big increase was Linux, which appeared in 40% more adverts and rose nine places up the table as a result. This appears to show growing enthusiasm for open source, as Unix, Solaris and HP-UX all featured in fewer adverts than a year ago and AIX was only just up.
The growth in demand for Sybase, which measures 17%, is a sign of vigorous activity in the financial sector, which accounts for nearly two thirds of all Sybase jobs. This sector was one of just three which increased its advertising on the web during the quarter (the others were software houses and the public sector).
The weakest sector during the quarter was electronics/communications, which reduced its advertising on the web by a quarter. Demand for networking staff from all employers was down by much more than the average. As a result, demand for comms skills generally fell.
TCP/IP was down two places to 12, Cisco fell five places, Lan six, Wan seven, VPN three and ISDN a whole 20 places. Ethernet is in its lowest ever position at 106, as is frame relay at 123.Expertise in embedded programming is also much less popular than a year ago, featuring in fewer than half the number of adverts. Comms companies have been the biggest recruiters of embedded programming professionals, and accounted for nearly one third of such jobs this time.
At the top of the table, there was little change. SQL and Unix were in first and second places in the quarterly skills league table, as they were throughout 2003. Among user organisations only, Unix was the skill most in demand, rising from third place last time, probably as a result of the increase in recruitment in the finance sector, where Unix is particularly strong. Finance companies account for nearly one third of all Unix demand, though they recruit less than a fifth of all staff.
About the survey
This article is based on information contained in the SSL/Computer Weekly Quarterly Survey of Appointments Data and Trends. The survey analyses advertisements for IT professionals on the web, in the trade press and the quality national daily and Sunday newspapers.
The posts advertised are broken down into 55 job categories; within each it provides details of the number of posts advertised and the average and median national salaries offered for the last quarter and for each of the previous four.
The survey provides further analyses within each job category by platform type, industry sector and region. It also provides a breakdown for the job categories of the technical skills most in demand. In each analysis, it details the average salary on offer for each of the past five quarters.
The price of a single issue of the survey is £250. An annual subscription costs £350 and includes four issues and a free copy of a Windows-based CD which allows for selection by region, industry and software skills.