Unexpected Gain in IT Certifications Pay in Q2, Report Finds

A Foote Partners report finds certified and noncertified pay rates rose unexpectedly in the second quarter for 2010, but notes market volatility is likely to continue to impact hiring practices in the IT sector.

Pay for 219 individual IT certifications displayed an unexpected gain in the second quarter of 2010 (April through June), the first quarterly increase since the same period in 2006, according to a recently published quarterly update of Foote Partners' IT Skills and Certifications Pay Index (ITSCPI) of market values for 449 certified and noncertified IT and business skills. Meanwhile, premium pay for 230 noncertified skills posted a second straight gain, returning to solid quarterly growth that began in 2004 but faltered briefly during the economic recession.

Also published this week were updates to Foote Partners IT Skills and Certifications Volatility Index, which measures and compares volatility in market values for certified and noncertified skills from 2007 through July 2010. The 2nd Quarter 2010 market volatility score of 32 percent remains virtually unchanged from the previous quarter, an improvement compared to the all-time highest index of 38.7 percent recorded last summer. The research firm noted volatility index scores of between 14 percent and 19 percent posted in quarterly returns from 2004 to 2008 have been considered normal market behavior heretofore.

David Foote, Foote Partners co-founder, CEO and Chief Research Officer and publisher of the report, said he believes this sudden burst in certifications market is an aberration and simply further evidence of highly volatile and uncertain conditions in the market for skills at the moment, and said he'd like to be able to report broader optimism in the labor market for certified professionals but can't.

"There's nothing in our research that points to any of the usual factors being in place that can sustain a more expansive turnaround in certification pay that has been on a steady decline for the past five years," he said. "Until that happens, from time to time you can expect to see short-term certification demand spurts like we saw in the 2nd quarter with specific specializations in applications development, networking and security."

Noncertified IT skill categories, which led a 1.7 percent average increase in pay premiums for 230 skills in Q2 2010 (April, May and June) include systems and networking skills (+3 percent in market value), applications development skills (+2.4 percent) and management, methodology and process skills (+2.2 percent). Specific IT certification categories saw a modest 0.5 percent increase in pay premiums across 219 certifications for the same period, with beginner and training certifications rising 5.6 percent in market value, followed by system administration and engineering certifications (+1.1 percent) and applications development certifications (+0.8 percent).

"As we've mentioned before, accelerated transition to new workforce models and IT service delivery systems is driving a lot of the current market. Employers have been struggling with transforming the IT workforce for years, trying to become more agile, flexible and responsive to the business," Foote said. "This skills market volatility is a sure sign that employers are taking advantage of a rare window of opportunity to think through and execute on new staffing models that don't have full-time hiring as a central component."