Tech sector exec demand down

Peter Dinham
Friday, 04 November 2011 13:15

IT People - People

Demand for Australian executives has slumped further to the lowest levels in eight years, with demand last month down in all business sectors. The IT industry was not immune, suffering a fall in demand in October, but recording a good result compared with other sectors.

According to the latest executive demand index from EL Consult, the overall slide of the IT index slowed but did not stop in October, with the index down 13 per cent.  Although a good result compared with other sectors, EL Consult makes the point that it does come after a 32 per cent loss in September.

The IT index also reveals that the larger states of New South Wales, Queensland and Western Australia contributed most of the downward impetus, with Victoria, Tasmania, South Australia and the Northern Territory being rare for actually providing positive results.

Demand in all market sectors was lower, with the financial and marketing sectors showing the biggest reductions, with EL reporting that Australian executive demand has slumped further to the lowest levels since October 2003, with demand now half that of the pre-GFC days.

And, EL's managing director, Grant Montgomery, says Christmas could be a grim affair for many Australian executives, with demand for their skills fallen to its lowest level, and as employers continue to deal with a global crisis of confidence.

EL reports that demand in all sectors fell 17 per cent in October compared with the previous month, compounding the 12 per cent fall of September, which Montgomery says leaves Australian executive demand at approximately half the level of 2007/08 before the global financial crisis.

'There are so many economic accidents waiting to happen around the globe that employers have crawled into their shells.

'As executive hiring is more affected by confidence globally than general hiring, the European crisis and the likelihood that Europe and the US are heading back into recession is skewering investment demand here, Montgomery observes.

According to Montgomery, the 'on again, off again' Greek settlement isn't helping matters and, he says, that is only the tip of the European crisis iceberg.

'While there has been some more confident behaviour from markets over the past few days, it is instructive to note that the credit default swaps and inter-bank lending rates among European banks is still reflective of crisis conditions. There is clearly still some way to go to convince those that are actually taking the credit risks - the banks themselves - that everything is roses in the financial markets.'