The number of vacancies for network staff fell by nearly 40% in the fourth quarter of 2001, after months of relatively high demand.
The sharp downturn provides further evidence that IT departments are postponing new projects and focusing instead on maintaining and developing existing systems.
Telecoms companies have shed staff dramatically over the past three months and now account for only 7% of the jobs advertised, compared to 11% a year ago, an exclusive survey for Computer Weekly reveals.
The total number of vacancies for IT staff fell between 20% and 30% compared to the last quarter of 1999, according to the SSP/Computer Weekly Quarterly Survey of Appointments Data and Trends.
Salaries have risen by just 2% compared to a year ago - the smallest annual rise for some time. Pay rates for some high earners have fallen, with management and systems consultants being offered an average of £66,000 per annum, compared to £72,000 a year ago.
Where IT departments are recruiting, they are hiring staff to maintain their existing systems. The number of vacancies for operations staff rose by 66%, and demand for hardware and service engineers almost doubled among IT suppliers.
Demand for business analysts has also risen sharply, as IT departments focus on projects that can produce a measurable return on investment.
Philip Virgo, strategic advisor at the Institute for the Management of Information Systems, said, "The number of people needed to keep systems running is rising. The need is to deliver serious support. New systems development is falling."
It is too early to say whether signs of growth in IT spending this year will result in a genuine recovery before 2003. Some observers suggest it may be another 18 months before the recruitment market fully recovers.
"I think we will see a certain amount of recovery in the spring," said Virgo. "The jobs market cannot continue falling but I do not think the recovery will be sustained."