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IT job cuts finally coming to an end Says ReThink

IT job cuts finally coming to an end Says ReThink

Only one in ten IT directors expect job cuts in 2013

Nearly half of IT directors forecast budget increases in 2013

Job cuts in IT departments are finally coming to an end, with only one in ten IT directors expecting to make job cuts in 2013, half the proportion planning job cuts a year ago, according to research by ReThink Recruitment, the talent and technology business.

The number of IT directors predicting job cuts is now at its lowest level in the past five years of ReThink Recruitment’s annual IT Director survey.

Michael Bennett, Director, ReThink Recruitment, says: “Confidence about what 2013 holds in store has spread throughout IT departments. Factors that tended to make IT directors cautious last year, such as the possible & lsquo;Grexit’ from the Eurozone, have subsided. Businesses are now hoping to bring years of IT job cuts or headcount freezes to a close and are ready to invest in their IT departments again.”

“Expected IT department job cuts had been disappointingly high up until now. The big dip suggests optimism is moving beyond isolated pockets, such as the retail or banking sectors, or where companies were investing in mobile or customer app technologies.”

Michael Bennett adds: “Generally, expectations of headcount, salary, and budget increases are all up on recent years. The importance attached to IT departments has grown enormously since the financial crisis, but paradoxically this has not been matched by growing IT investment. IT spending now looks like it has turned a corner.”

The survey also found that only 25% of IT directors expect to make budget cuts in 2013, down from 36% last year.

Meanwhile, 48% of IT directors expect their departmental budget to increase in 2013, up from 39% last year (see graph below).

Michael Bennett says: “Whilst IT budgets are now increasing it will be a while before they reach their pre-recession levels again. IT directors will be hoping it is not too late to reverse the long-term impact of years of IT under-spend.”

“Although IT investment is improving, IT budgets are still under pressure.”

Headcount and salary increases cause staffing concerns for IT directors

ReThink Recruitment’s survey also found 87% of IT directors were concerned about attracting the right candidates to vacancies and 83% were concerned about retaining staff.

Michael Bennett says: “Salaries and headcount are beginning to move upwards following a long period of restraint. IT directors will be concerned about the depth of the talent pool available to fill the new roles being created, particularly when these roles involve newer technologies, such as app development or cloud computing.”

“With pay rises finally becoming the norm again, IT departments may struggle to hold onto staff that have put up with years of pay freezes and who could be easily tempted to move elsewhere by the offer of a better salary.”

According to ReThink’s survey, 67% of IT directors expect to increase pay next year, up from 59% last year, and just 47% the year before 

ReThink Recruitment’s fifth annual survey of IT directors includes responses from a broad cross-section of organisations, including several global companies with IT departments with over 150 employees.


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