Demand for IT executives shoots up in May

Stan Beer
Friday, 15 June 2007 12:51

IT People - Enterprise

The availability of jobs at the top end of the IT market surged during May, pushing growth in demand for IT executives to the front of the pack of high end professionals, according to a new report.

Demand for IT executives grew 35% in an all round bouyant market during May, according to the E.L Executive Demand Index, produced monthly by executive search firm E.L Consult. Information Technology was the best performing sector, followed by Management. The Financial sector and Engineering sectors registered slight gains, while Marketing fell.

According to E.L Consult CEO Grant Montgomery, the increased demand for IT and other executives has been accompanied by a 30% increase in online advertising over the past 12 months.

"Since May 2006 the growth in the level of advertising online has been close to double that of print advertising. Advertisers are moving online because they get to target candidates in a large number of geographical regions at the same time and because it is significantly cheaper than newspaper advertising. There is no doubt that newspaper advertising can be effective, but in terms of scope when you are looking for candidates internationally the Internet is way ahead," Mr Montgomery said.

Despite the surge in May, demand for IT executives is experiencing steady growth rather than booming, according to Mr Montgomery.

"The thing about IT is that it tends to go in its own cycles," he says. "You get new releases of software which push up the whole thing and then companies seem to make budget investments at a certain time in their IT development. It seems to cycle along a 12 months budget cycle. In the new financial year, you get a commitment to more spending which means more resources."

Mr Montgomery believes the current phase of IT executive jobs growth is being driven by demand for more capacity in organizations rather than innovation.

"It's no longer a case of everything's new every day," he says. "People are now making investment decisions in terms of more IT capacity but not so much better IT capacity. There's not that cycle of innovation that was happening more than five years ago. There hasn't been huge developments in general IT for a few years."

According to Mr Montgomery, the May upswing in demand for IT executives was at least in part driven by government budgetary spending prior to the closure of the financial year. What's more, demand should continue through into the early stages of the new financial year.

"They tend to spend their money before the end of the year if they've got extra capacity," he says. "When July comes that's the new budget, so there will also be spending then. Once they do those two either side there may be a downturn a little bit later. However, over the next 12 months we're probably going to see a surge again. If you take a three months moving average, it will show an upward trend. Over three months it's probably going to increase 10-12%."

Mr Montgomery's predictions, if correct, bode well for the lower end of the IT market as well.

"When you make a commitment to further investment in IT, you usually get your senior people online first, he says. "They do the planning and processing for the future. Then you get the skilled operators, the next level down. So when you get a boom in the IT executive sector, there's about a three to six months lag before you get a boom among the programmers and systems implementers."