Figures on hiring trended downward last month, and IT spending is looking grim as several major vendors lower expectations for growth.
sector shed 39,000 jobs between August and September, according to a monthly
employment report from payroll giant Automatic Data Processing, which tracks
private-sector hiring with the aid of economists from Macroeconomic Advisers.
The report receives data from 500,000 U.S. businesses and more than 2 million private-sector employees.
industry sector of the economy that saw job growth in September was the
service-providing sector, which had gains of 6,000 jobs. Construction,
manufacturing and goods-producing industries all saw declines. Medium-sized and
small businesses took the largest hit last month, each
losing 14,000 jobs; large businesses shed 11,000 jobs. The ADP report does not mince
words on the status of overall employment in the United States:
decline in employment followed seven monthly increases from February through
August. However, over those seven months, the average monthly gain in
employment was 34,000. There simply is no momentum in employment."
The ADP report is a closely
watched information set by investors and economists, and is a precursor to monthly
data set to be released by the U.S. Department of Labor's Bureau of Labor
Statistics later this week. ADP's report does not include federal employment information, but was
quick to point out that government employment numbers had been seeing a decline
from the closure of many census-related jobs from the spring months when a
significant number of temporary census workers were employed in every state.
So what is
happening to IT? Job vacancies, as measured by online job openings for
technology, expanded by 15,200 positions nationally last month, according to a
monthly report from The Conference Board, a nonprofit organization. However,
open positions do not necessarily translate into major gains in jobs being
In terms of
current job demand, systems, network, programming and project management skills
nationwide survey of employers, completed in September, shows 38 percent of IT
employers plan to hire full-time, permanent employees in the fourth quarter; 11
percent expect to decrease head count," said CareerBuilder spokesperson
Jennifer Grasz in an interview with eWEEK. "We see continued demand for
computer programmers, software developers, network engineers, network systems
analysts, system security analysts, project managers, Web-related occupations."
spending is up a little, but IT spending is slowing down, according to Seeking
Alpha writer Michael Shulman, who writes about the economy from an investor's
perspective. He sees key economic indicators, including credit, general
optimism, government spending, consumer spending, business spending and exports
all trending downward.
in his blog post "Inside the Latest ADP Report
[business spending] is up slightly, but the traditional motor, IT spending, is
taking a hit according to ChangeWave and other surveys as well as forecasts
from companies such as Intel and Cisco... The bottom line: The double dip is
here. If not in the data, then in the real world, and the market seems to like
this for it ensures more liquidity from central bankers. That being said,
stocks trading based on real-world earnings, such as industrial cyclicals,
luxury goods retailers and IT companies, are in for a rough ride."
predicted that jobs were going to rise by about 50,000, but the ADP report showed the
economy-at least in terms of hiring-is waning.