Skills market to tighten in 2006

Stan Beer
Tuesday, 06 December 2005 15:16

IT People - Enterprise

As 2005 draws to a close, ICT employers and market analysts are already warning that 2006 is set to see a skills squeeze not seen since the days of pre Y2K.

Phil Johnstone, the recruitment director of SMS Management & Technology, one of Australia's largest local IT consulting groups to the government and banking sectors, says that he is expecting 2006 to be very tough on finding the necessary people to meet the company's growing portfolio of contracts.

"We will need somewhere between 100 and 150 net new highly skilled people for the year and, with the normal attrition rate of people leaving, that means we will have to find about 200 new people," said Mr Johnston.

Businesses will find it increasingly difficult to find the skills they need to maintain their growth in 2006 warns SA's leading technology investor.

Amanda Heyworth, CEO of SA-based seed investor Playford Capital, said the skills shortage that existed in specific technical areas would become broader in the coming year. 'It's a seller's market for top quality skills,' she said.

'In 2006, I think it will be significantly harder to get good technical people. It has been true in some specific technical areas such as project management, communications and informatics for a while, but we are starting to see it more broadly.'

Playford Capital is a seed investor that partners with other investors and venture capitalists to fast track the growth of innovative technology companies based in South Australia.

Ms Heyworth said the fundamental problem was not enough people were learning hard technology skills. 'The number of kids going to study in IT and other technical fields is static while at the same time our needs have gone up,' she said.

'The other major challenge is to find skilled people who can sit between those technical people and the market - these are the business development professionals who can understand technology, recognise what the market needs and actually sell the products. Without them on board, it's much harder to sustain strong sales growth.'

According to Mr Johnston, increasing graduate programs at companies like SMS, while being valuable in the long term, will not provide solutions to the consulting skills shortage in the short to medium term. "We have to put our A-team out in the field and we can't put fresh graduates out on client sites at $1500 a day," said Mr Johnston. He admitted that companies may have to look offshore for high-end skills in places like the UK. "The UK is a particularly good place because there are a lot of highly skilled Australian expats who are looking to return home," he said.

Ms Heyworth said investment opportunities were improving in an environment where business was again investing as technology to improve competitive advantage. 'While the 22 per cent sales growth of 2005 will be a hard act to follow, the overall business outlook is positive,' she said.