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The No. 1 thing on the mind of large and midsize businesses is revenue generation, according to an IT industry report from the Computing Technology Industry Association on technology business confidence. Over the next two quarters, 53 percent of companies surveyed plan to invest more in research and development, entering new markets, and rolling out new product lines. However, confidence has slipped a little since December, CompTIA said.
“IT companies expect continued sales growth to materialize,” Tim Herbert, CompTIA vice president of research, said in a statement. “With perceived recovery momentum comes rising expectation that business activity [will follow] soon thereafter. If it doesn’t happen, confidence can weaken.”
Thirty percent of 336 companies surveyed expect to expand staffing in the next six months. On the flip side, 18 percent of companies are expecting to shed technology workers, so there is a net gain of 12 percent expected. As the recent March employment figures suggested, there is short-term volatility in technology hiring, but the bigger picture shows overall growth. Over the last six months, 22,300 technology jobs were created, according to numbers provided by the U.S. Department of Labor’s Bureau of Labor Statistics.
“This volatility, with employment numbers rising and falling month to month by segment but gaining overall, will continue at least through the end of the year and probably into the next,” said David Foote, CEO of IT labor analyst company Foote Partners, in a recent news release on the March labor data. (PDF) “Jobs growth in the technical services and computer systems services sectors will continue to prop up IT employment for the foreseeable future.”
Both the CompTIA report and the Foote Partners analysis express a sense of change in the air, as staffing needs will adjust and correct with business execution.
“The freeze in IT spending for specialized skills has thawed at many of the companies we talk to, and I think we’ll be seeing that transform into less reliance on contractors and consultants by this time next year as companies feel more confident about budgets and bringing back workers they’ve laid off,” Foote said.
However, there are still legitimate concerns about the relative stability of the economy and consumer spending, especially for small businesses. From the CompTIA report:
“The smallest IT companies-those with less than $1 million in annual revenues-feel the most concern about the state of the economy and their prospects in the IT industry. This sentiment reflects both the severity of the recession and the strain it placed on small businesses.
In the “what keeps IT executives up at night” category, firms voiced concern over a number of issues. Topping the list are a stalled recovery, weak consumer demand, a general lack of confidence and government regulation.”