New York, Washington Lead Nation in IT Job Creation

By John Pallatto  |  Posted 2004-08-16

New York, Washington Lead Nation in IT Job Creation

The hottest high-tech recruiting markets in the United States in 2004 have shifted from the historic job-creation engines of Silicon Valley and Boston to New York City and Washington, according to Dice Inc., an online job site for technology careers.

"Washington is the hottest technology market in the nation right now," with the federal government recruiting heavily for national defense and homeland security IT projects, said Scot Melland, president and CEO of Dice, based in New York.

But New York has risen to the top of the job-posting list because its diverse IT job market is being led by the financial services industry, which is recovering from the dual blows of an economic recession and the 9/11 attacks, Melland said.

The government is recruiting to staff multiyear, multibillion-dollar projects that require technical professionals with a range of skills, including experience with Java and C language development skills as well as with the Unix and Windows operating systems, Melland said.

"If you have an active security clearance as a tech professional, you can almost write your own ticket," he said, due to the shortage of people with this qualification.

In fact, government and defense industry recruiters "literally cannot find enough people to fill open positions," causing two-year delays in some defense and aerospace projects, he said.

Overall, the demand for technology jobs in 2004 "is substantially better this year than it was a year ago," Melland said, with job listings more than double what they were in 2003.

Dice reported in July that job postings seeking Linux experience totaled 2,243 since June 2003, a 190 percent increase. This trend is likely to continue into the foreseeable future. "I would make sure I had some open-source credentials if I were a young software-development professional," Melland said.

Another trend is that recruiters are placing less emphasis on technical certifications in specific technologies compared with hands-on experience. "These days, real-world experience is in demand," not just a sound education, he said.

Washington and New York have replaced Silicon Valley and Boston as the perennial tech recruiting leaders since the dot-com bubble burst in 2000. As of July, Silicon Valley was in third place. Boston has dropped to eighth place. Today, Los Angeles is in fourth place, followed by Chicago and Dallas.

Click here for a column on stemming IT job loss.

The technology recovery is unusual because it is being led this time by job growth on the East Coast rather than on the West Coast, as had been the case for most of the decade before the 2001 recession, Melland said.

But nearly all areas are showing improvement. Tech recruiting is up 65 percent in Silicon Valley, up 85 percent in Boston and up nearly 100 percent in Seattle so far in 2004, according to Melland. The recovery has been has been slower in those areas compared with New York and Washington, but it has been gaining momentum, he said.

But another high-tech center, Austin, Texas, has yet to show a significant recovery, Melland observed.

Next Page: No hiring slowdown on the horizon.

No Hiring Slowdown

Dice has seen no sign yet that there will be a significant softening of demand for high-tech jobs in the second half of 2004, Melland said., another online job recruiter with a focus on the IT industry, echoes this view. The employment slowdown reported in July isnt necessarily an indication that the nations economy is going to slow down in the second half, said Marcel Legrand, senior vice president at

Monster.coms customers "are pretty bullish about the rest of this year," Legrand said. The number of postings the site is getting isnt slowing down, he said, suggesting that the slowdown may just be a seasonal blip in hiring.

"Everybody is on holiday. July and August are just not a good time to be thinking about business and employment trends," Legrand suggested.

People have to remember that the 3 percent unemployment rate reported in the late 90s was an aberration, Legrand said.

For the past three years, unemployment nationally has ranged between 6.5 percent and 5.5 percent, he said, adding that an unemployment rate of 5 percent is historically a great number. People shouldnt expect that unemployment is going to fall to the rates seen before 2000, he said.

Monster disagreed with Dice in terms of what is happening in the financial services industry. IT administrative jobs in the financial services sector have decreased in recent months, Legrand said. In particular, the mortgage banking industry has shed about 1,600 IT jobs in the past six months, as even a slight increase in interest rates has reduced the massive wave of mortgage refinancing that prevailed over the past two years.

But Monster has also found that IT professionals are making a recovery from the losses of the bubble years. For example, people who lost jobs in the telecommunications industry recession have found they can bring their skills to the health care industry.

In additional, technology management positions, such as WAN (wide area network) management or software engineering management, have grown faster than any other position, Legrand said.

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