More pain, not much gain on the job front

IT’s horror year continues in the wake of more staff cuts

Australia’s job advertisements fell by a mammoth 48,000 employment opportunities over November, compared to a decline of just over 20,000 last month, according to the Olivier Job Index (OJI).

The IT&T sector fell 7.6 per cent – compared to last month’s 4.4 per cent dip and October’s 3.27 per cent slump – to bring its annual decline to 30.5 per cent, making it the fourth worst industry sector nation wide.

"That’s the worst I can ever recall," Olivier director, Bob Olivier, told ARN.

Compared to all other industry sectors, IT&T’s decline in job advertisements for November was at the lower end of the scale. The advertising & media, and administration & clerical sectors both fell by over 20 per cent.

But the news for IT is not good.

"The worst hit for the month was desktop support down 15.9 per cent and 40 per cent for the year, that is the worst hit in percentage terms," Olivier said.

"But in terms of volume, the most critical is software development and that was down 7.2 per cent this month and 31 percent for the year, and management & sales which is down 12.8 per cent for the month and 37 percent overall. There is really nowhere to hide, it's all very dismal figures."

According to the OJI, the stress on managers to cut staff, and employees’ fear of being fired, is widespread.

“Companies are cutting staff that isn’t client facing or revenue raising,” Olivier, said.

"I think IT is also particularly hard hit by the fact that it’s a more global business by nature and therefore Australian operations of global companies are caught up - even if they are performing reasonably well - with freezes and retrenchments."

Olivier claimed the recent reduction in official interest rates won’t be felt until February when employers return to the market with fresh budgets and New Year resolutions.

"Invariably December and January are quiet, you can't pick a trend then. The bellwether month is February, people come back with some hiring intentions, that is good."

But interest rate cuts, lower mortgages, and the lower cost of fuel could turn consumer sentiment around, he said.

Nevertheless, November’s dip represents the fifth straight month of decline in the OJI.

Victorian positions vacant were down 10 per cent, while NSW suffered an above average 12 per cent dip. Resource rich states Western Australia and Queensland also fell by 8.67 per cent and 8.63 per cent respectively.

According to Olivier, the only good news for IT this month is that employers shouldn't encounter recruitment difficulties.

"It's a fantastic opportunity to strengthen your team, there will be good people in the market we haven’t seen for a long time," he said.

Last month, a Hudson recruitment report found IT&T employers unaffected by the current economic climate, but expectations have dipped and the focus has shifted to the passive job market. Olivier predicts fierce competition between graduates in the New Year.

IT companies such as Data#3, UXC, Ericsson and Adobe have all recently cut local staff numbers.

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