It’s not clear from outplacement giant Challenger, Gray & Christmas’ latest job cuts report where IT exactly stands, but the numbers that it is giving across most industries suggest a fair amount of people at the beach for the remainder of the summer months, as inflation is on the rise.
Sorry to report what is definitively bad news, but let’s be clear about something: This report doesn’t give IT its own category, so take the data for what it’s worth. According to the report, July is the second month this year where job cuts in the United States were over 100,000 (103,312 to be exact). Here’s some of the pertinent data from the report:
“The July figure is the second largest of the year, behind the 103,522 planned job cuts announced in May. It marked a 141 percent increase from July 2007, when employers announced job cuts totaling 42,897. Employers have now announced 579,260 job cuts this year, which is 33 percent more than the 436,396 job cuts announced through July a year ago. The pace of job cutting over the last four months is significantly higher than the first quarter of the year, when job cuts averaged 66,885 per month. Since April 1, monthly job cuts have averaged 94,651, a 42 percent increase.“
The pace, while not specific to IT, is difficult to ignore. We could be seeing numbers like those of the post-Internet-bubble era (in 2001, for example, there were nearly 2 million layoffs). The bulk of these numbers is made up by workers in the transportation, financial and retail sectors, where turbulence has been a dominant theme, and it has been a truly difficult time for many afflicted by the economic downturn. This snapshot from the report lays out the specific industries:
“JOB CUTS BY INDUSTRY JULYTransportation 17,051 Financial 15,517 Retail 12,160 Automotive 11,631 Entertainment/Leisure 10,893 Health Care/Products 6,218 Government/Nonprofit 5,168 Consumer Products 4,420 Food 3,384 Electronics 2,585 Computer 2,524 Aerospace/Defense 2,208 Media 2,168 Services 1,722 Industrial Goods 1,629 Construction 1,378 Pharmaceutical 1,048 Telecommunications 995 Real Estate 264 Insurance 141 Commodities 125 Chemical 83TOTAL 103,312“
IT could be touching almost all of these industries. If the airlines, investment firms and Starbucks of the world are struggling lately, then it might follow that workers in high-paying IT jobs could be getting pink slips. And yet, critical system functions that at their core help the business make money need people to maintain, upgrade, design and build newer core systems. When you look beyond much of the sector-specific data, cost-cutting happens in every organization, especially if your company is public and answers to shareholders with growth expectations regardless of economic cycles.
And in related news, Gartner recently reported that IT salary increases are holding steady, but staffing is a little down. From the Gartner report: “According to a survey of 285 U.S.-based IT organizations, 57.9 percent projected an increase in IT staff levels … during the survey time period (March 1, 2008 through February 28, 2009). However, this is a notable drop from 66.3 percent reported in the 2007 study.”
How much of an increase, as in how many jobs, isn’t abundantly clear. What’s it really like out there for you this summer in your technology job?