IT Job market shrank by 55,900 jobs in 2020 - Covid and Shutdowns were drivers
First time since the DOT COM bust the IT job market shrank according to Janco
Park City – UT– e-janco.com – Even with upward adjustments by the BLS of 12,400 IT jobs for October and November, and an addition of 20,600 new IT jobs in December, the IT job market still shrank by 55,900 jobs in 2020. According to analysis by Janco, most the IT jobs lost were in SMB that were, and continue to be, impacted the most by the Covid Pandemic.
The CEO of Janco Associates, Inc., Mr. M. Victor Janulaitis said, ““Larger enterprises are closing their doors permanently at a record pace, but that’s only part of the carnage. The major loss of jobs for IT professions was in SMBs and the consulting firms that service them. There are over 7.5 million small to mid-sized business nationally. They have been disproportionately impacted by shutdowns. An uncounted number of these SMBs are disappearing amid the shutdowns, and the drag on the economy from these failures will linger for some time. Firms with fewer than 500 employees account for about 44% of U.S. economic activity, according to a SBA, and they employ almost half of all IT Professionals.”
Janulaitis added, “It has been reported that over 100,000 restaurants will never re-open. This an example of the wave of silent business closures among SMBs. These closures most often are uncounted and un-noticed in part because real-time data is scarce, and owners of these firms often have no debt, and thus have no need for bankruptcy court. However, the impact on the size of the IT job market is real as those IT jobs just disappear. “
Janulaitis said,” In addition, there also has been shrinkage in the number of IT Professionals classified as working for ‘Data Processing, Hosting and Related Services’ and “Computer Systems Design and Related Services”. IT Service providers are feeling the pinch as those two classifications account for over 75% of the 55,900 jobs lost in the last 12 months.”
IT Job Market Change - August 2023
IT Job market grew by 8,400 YTD in 2023 with economic slowing and major layoffs. Analysis shows that IT Job Market growth has paused and that AI hiring trend has not taken hold as of yet.
Janulaitis said, “Until a majority of the population is inoculated, the pandemic will continue to put pressure on governments to close businesses and enforce ‘social distancing’. This will hinder the speed of the recovery.” The CEO added, “There was a net loss of jobs in the last 12 months of 55,900 jobs for IT professionals. Hiring has all but stopped due to the uncertainty in the economy. In addition, salaries are flat for almost all positions according to our 2021 IT Salary Survey. Not a very bright picture.”
The CEO also said, “Spending for IT products and services continues to slow as companies reevaluate the state of the economy globally as new waves of selected shutdowns occur not only in the US but the EU and the UK. Based on our current data, hiring for IT professionals will be retarded for the next two quarters. This is driven by business closures and limited in-person contacts. This will continue until the public, management, the government feel safe to move away from ‘social distancing’ solutions. Few companies are taking an aggressive approach to any additional spending for IT products and services.”
Current IT Hiring Plans - IT Job Hiring Slows
The treat of an economic downturn, inflation, high energy cost, and the continued war in Ukraine will continue dampen hiring for IT pros over the the next few quarters.
Janco is an international consulting firm that follows issues that concern CIOs and CFOs. The firm publishes a series of IT and business Infrastructure HandiGuides® and Templates including IT Infrastructure Policies and Procedures, Disaster Recovery/Business Continuity Template, Security Template, IT Job Descriptions, and its semi-annual IT Salary Survey.