IT salary survey: job market bucks predictions

The last quarter of 2007 produced a frenzy of financial gloom in the media, following the crises at Northern Rock, Swiss bank UBS and the consequent decision by the Bank of England to cut interest rates. British business, however, displayed a far more robust response, to judge from the cwjobs.co.uk Survey of Appointments Data and Trends compiled by Salary Services Ltd (SSL).

The last quarter of 2007 produced a frenzy of financial gloom in the media, following the crises at Northern Rock, Swiss bank UBS and the consequent decision by the Bank of England to cut interest rates. British business, however, displayed a far more robust response, to judge from the cwjobs.co.uk Survey of Appointments Data and Trends compiled by Salary Services Ltd (SSL).

Permanent IT jobs advertised on the web shot upwards by a third relative to the same quarter in the previous year, maintaining the healthy growth trend that has now lasted for eight consecutive quarters. The fourth quarter figure was also up on the third quarter of 2007, when the press first published pictures of queues at Northern Rock branches and the word "sub-prime" first entered the nation's consciousness: here the rise was 7%.

The contract jobs market was similarly buoyant at the end of last year, with jobs up between a quarter and a third on 2006, and 10% up on the third quarter of 2007. So as Harvey Nash Group's marketing director, Paul Smith, puts it from the recruitment market's perspective, "The market belies the analysts' and economists' view of where we are. Everything seems to be pretty normal."

Taking 2007 as a whole, permanent jobs were up 17% on 2006, and were higher than in any year since 2001. Contract jobs rose over the year by around the same amount (15%).

The finance sector is where one would expect any downturn to show first, but you have to look hard to find any evidence of belt-tightening even here. Jobs rose in these companies compared with 2006 by a little above the average - 36% - in the permanent market and by exactly the average - 28% - in the contract market. In both these areas there was a slight decline - 6% and 2% respectively - from the third quarter, so possibly the first hint of recession can be discerned here.

Another sign may be that IT jobs in central London were down by 5% on a year ago. This is a noticeable contrast with the third quarter, where the City registered the biggest year-on-year rise.

These slight cutbacks pale into insignificance, however, when we turn to the manufacturing sector, where jobs actually fell by a much larger margin: 16% from a year ago. They accounted for 4% of all permanent IT jobs advertised then, and just 2% last time. The electronics and communications sector, monitored separately by SSL, is also in a depressed state jobs were fractionally up on a year ago, but overall they fell from 7% of the market to 5%.

In the contract market, the picture is similar, though the detail is different here the electronics companies cut back recruitment by nearly a fifth, and manufacturing companies registered a small increase.

So in this context, it has to be said that the finance sector is much more buoyant than general predictions would suggest, and has shown little reaction so far to the apocalyptic rumblings in the press.

Geographically, inner London was the only area to show a fall in jobs advertised relative to a year ago. Conditions in the City were in marked contrast to the rest of the capital, where jobs rose by well above the average, and they were also substantially up in the rest of southern England.

The biggest rise last time came in Scotland and Northern Ireland, where the jobs on offer nearly doubled. This again contrasts with the third quarter, where jobs fell relative to 2006 by 10%. While job-seekers in these areas undoubtedly enjoyed a good fourth quarter, they should not read too much significance into these fluctuations. The total market is small - around 4% of all UK IT jobs - and the activities of one or two major employers can have a disproportionate impact.

Opportunities were also significantly up in the Midlands and the north of England, which is another change from the third quarter.

A noticeable feature of the contract market this time has been an increase in demand for senior staff. Overall senior jobs on offer rose 33%, and junior jobs were up 26%. Positions on offer for senior software engineers, database analysts and PC support staff all doubled, and demand for consultants increased by nearly as much. This highlights the difficulty employers are finding in recruiting the senior staff they need, as reported in several surveys: demand here is much greater than the supply.

Jobs advertised in the printed media continued to decline, and are now at their lowest level since the SSL survey began 21 years ago. They are running at a quarter of the level of a year ago, and now account for less than 1% of all jobs advertised.

The average salary on offer to the IT professional in the fourth quarter rose by 2.6%, the same as in the second quarter and up from 1.9% a year earlier. It is a significant fall from the 5% registered in the third quarter, but that was a quite exceptionally high figure that looks now to have been a statistical glitch. Having said that, average rates in the contract market rose by 4% last time, which is also significantly higher than in any other recent quarter. But according to Smith, "the salary reduction shows a little bit of caution. People are not paying wild salaries."

A landmark was reached in the fourth quarter when, for the first time, the average salary for IT directors topped six figures. The actual figure of £104,707 is 15% up on a year ago. Some professionals at the bottom of the IT staff pyramid also did well, with double-digit rises in the average salary on offer to junior programmers and operators.

The methodology used by SSL in compiling the skills league table has changed this time, and as a result there are a lot of minor changes. The skills making up the top 25 are unchanged but there are many changes of position.

New-wave Microsoft development skills feature prominently, with C# up to fourth, .net up to fifth and ASP up to eighth. These were the skills to show the biggest growth over the year along with SQL Server (sixth), with demand up 40% or more in each case.

Just outside the top 25, the open source alternative to ASP is moving up fast. PHP is now 27th, up 10 places from last time.

Open source is continuing to make headway in the Unix market as well. Linux has risen to its highest ever position for the second quarter in a row, and now lies 13th. Unix, meanwhile, is one of just six skills in the top 25 to feature in less advertisements than a year ago. Only Microsoft Office and UML have fallen faster this time.

The main alternative to Microsoft-based development remains Java, with the programming language itself lying in third place, and Javascript up to 18th, again a new high for the second quarter in succession. Further down, Ajax is beginning to make an impact it only entered the SSL table in the third quarter of 2007, but is already up to 39th. Perhaps surprisingly, it features in five times as many advertisements as the much more highly publicised newcomer, Vista, which is down in 82nd place.

Demand by job category

Demand by region

Demand by sector

Demand by skill

How average salaries have changed

About SSL

This article is based on information contained in cwjobs.co.uk Quarterly Survey of Appointments Data and Trends, compiled by Salary Services Ltd.

The Survey analyses advertisements for IT professionals on the web and in the trade press and the quality national dailies and Sundays. It is primarily intended for recruitment agencies and CIOs with a substantial recruitment requirement.

The posts advertised are broken down in the Survey into 55 job categories. Within each job category, the Survey 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 regional location. It also provides a breakdown for the major job categories of the technical skills most in demand. In each analysis, it again details the average salary on offer for each of the past five quarters.

The price of a single issue of the survey is £250, and for an annual subscription is £350. This covers four issues, and includes a free copy of a Windows-based software product on CD which allows selection of combinations of region, industry and software skills for a specified job type. Readers can order at www.salaryservices.co.uk.

 

Read previous SSL Surveys and the latest TechTarget 2012 IT Salary Survey.

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