Job cuts put IT employment at its lowest level for a year

The number of people employed in the IT and telecoms profession has fallen to its lowest point for more than a year as employers...

The number of people employed in the IT and telecoms profession has fallen to its lowest point for more than a year as employers continue to lay off staff and cut their workforces.

The number of IT and telecoms professionals in work in the UK has dropped by 62,000 from a peak of 1.149 million at the end of 2001 to less than 1.087 million in the second quarter of this year.

But despite the tough conditions, there are signs in the latest E-Skills UK Quarterly Skills Analysis that the slowdown may be reaching the bottom of the trough.

"The rate of increase of unemployment is slowing down and is in line with E-Skills UK's expectations. This is a good indicator that the downturn may be bottoming out. We expect to see signs of recovery in the first half of 2003," said Terry Watts, chief executive of E-Skills UK.

Unemployment rates for IT and telecoms professionals across all industries have increased from 2.5% in mid 2001 to 4.1% at the end of the last quarter. But this is still below the average of 5.2% unemployment for all occupations.

The largest falls in employment were seen among telecoms engineers, down 13% since the first quarter of 2002, and IT strategy and planning staff, down 8%.

There has been a significant decline in demand for IT staff with HTTP, Progress and DCom skills, although staff with SQL, C++, Unix, Windows NT, Java and Visual Basic skills are still popular with employers.

The number of firms reporting difficulties hiring IT and telecoms staff has fallen dramatically from 18% in the first quarter of 2001 to just 6% in the second quarter of the year - an indication that the skills shortages reported in the late 1990s have subsided, at least temporarily.

IT suppliers have borne the brunt of the downturn. Employment of all types of staff fell by 49,000 in the second quarter of 2002 to 906,000. This is the third successive quarter of job losses among IT supplier.

Read Simon Moores' Thought for the Day on IT job prospects

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