European IT Sector Shows Rapid Growth Despite an Overall Weak Economy
NEWS ANALYSIS: The European economy has yet to fully recover from the recession that started six years ago, with the exception of the IT sector, which is growing rapidly.HANNOVER, Germany—The European economy is weak, especially when compared to the recovering U.S. economy. The difference is so great that it's beginning to negatively affect the earnings of multinational companies. In fact, those weak earnings, brought on in part by a strong U.S. dollar, caused a 300-point drop in the New York Stock Exchange on Jan. 27. The strong dollar was brought about not only by a strong U.S. economy, but also by the relatively weak euro. The weak euro is a symptom of a European recession that was triggered and prolonged by the continent's persistent debt problems, along with economic policies that tended to further erode the euro's value. Of course, there are other factors coming into play. The euro hit an 11-year-low against the dollar on Jan. 26 after an anti-austerity party declared victory in Greece's parliamentary election on Jan. 25.
While the strong dollar is nice for American visitors to Europe, it's not great for big companies that are selling things to Europeans. So, how is it that BITKOM is reporting 73 percent growth for the European IT industry this year over 2014's results? And how is it that IT hiring is up sharply to the point that the biggest factor holding it back is a lack of skilled people?