The nationwide job market for IT professionals is undeniably robust, with an unemployment rate of just 2.5 percent. Still, significant downsizing occurred in the computer industry in 2014, according to a Challenger, Gray and Christmas report.
Overall, the tech sector was responsible for 21 percent of 483,171 total job cuts announced in 2014. It marked the first time that tech-sector job cuts exceeded 100,000 since 2009, when they reached 174,629.
The biggest increase in job-cut activity occurred in the electronics industry, where annual job cuts surged 120 percent from 8,830 in 2013 to 19,408 last year.
The report covers only job cuts announced by U.S.-based firms. The demand for IT workers globally is relatively strong, according to CEO John Challenger.
In particular, he singled out the advanced economies in Europe and other emerging markets, which he noted are rapidly expanding the use of technology.
A report released earlier this week by online IT jobs portal Dice painted a similarly rosy picture—though not across the board.
Technology consulting added 26,500 jobs in the fourth quarter, for example, but data processing, hosting and related services lost 700 jobs, Dice reported.
Dice president Shravan Goli told eWEEK the company’s latest hiring survey found more candidates are rejecting offers, with 29 percent of hiring managers seeing rebuffs, compared to 26 percent in June 2014 and November 2013.
“Today, it’s hard for many companies to find top tech talent. The market is very competitive. What I would suggest to companies in search of tech professionals is to really think outside the box, both in regard to recruitment tactics and company perks,” Goli said. “You need to make clear what separates you from other firms. From a compensation standpoint, put your best offer forward when you are negotiating with a candidate.”
While that advice may work for some tech firms, two of the industry’s biggest tech titans appear to require some streamlining.
The report noted that both HP and Microsoft announced plans to cut payrolls by 59,523, a combined 69 percent increase from the 35,136 job cuts by these companies in 2013.
IT Job Market Robust, Despite Layoffs at Microsoft, HP
“Yes, layoffs were up significantly last year, but this was partly due to a handful of large layoffs announced by large firms that are trying to become more competitive in a changing and expanding tech environment,” Challenger said. “So, we feel that despite the increase in cuts, the situation for tech companies and workers is indeed pretty good and is likely to continue improving this year.”
He said IT workers who are looking to change jobs should cast the widest net possible.
“People, in general—not just IT workers—tend to seek job opportunities with the same job title, in the same industry and in the same geographic location. The need for IT workers expands well beyond the tech industry,” to health care, manufacturing, and professional services, Challenger explained. “There are also opportunities beyond the borders of Silicon Valley, Boston and Seattle, in places like Omaha, Nebraska, Jacksonville, Florida and Milwaukee, Wisconsin.”
He said he expects the tech job market will continue to be strong in 2015, particularly in growing areas like big data, cloud computing, mobile app development and information security.
“The layoffs from the legacy companies could be a great development for smaller firms that may have been struggling to find talent–that is, if the workers from these firms are willing to lower salary expectations and look for opportunities at fledgling operations or with companies outside of the tech sector or in regions of the country where salaries are lower–along with the cost of living,” he said.
Some firms already are having difficulty finding talent plus the shortage is expected to worsen as other factors, such as retirements, increase the need for more workers, Challenger warned. All of this benefits young, entry-level job seekers in the tech sector, who can take advantage of companies trying to build or re-build their bench, he said.
“Yes, companies want experienced people, but they also need to bring in young talent to replace those experienced workers when they get poached or retire,” he explained. “Companies that are not bringing in fresh, young talent are being very shortsighted and are likely to regret that strategy as labor shortages worsen.”
Goli echoed that sentiment, noting that the latest Dice hiring survey shows that companies plan to boost their hiring in 2015. Tech candidates will have a greater number of companies to choose from, he said.