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ICT faces critical shortage of IT security execs

There’s a critical shortage of IT security experts in Australia to meet an otherwise welcome increase in the demand for ICT executives after months of employment uncertainty for the country’s tech executives.

According to the latest executive employment index from EL Consult, despite a further increase of 4% in demand for executives across all industries last month – ‘thanks to a boost in jobs for management and information technology executives” – the good news is dampened somewhat because of a critical shortage of IT security experts.

The ICT sector, however, outstripped most sectors with a 14% rise in demand for ICT executives last month – “albeit off a low base after a string of falls in previous months,” observes EL managing director Grant Montgomery.

“Information Technology was the standout performer with a 14% rise in the number of jobs on offer. While this could be an indication of increased capital investment in computing it is most likely to be driven by the increasing need to build better and better systems security,” Montgomery said.

EL reveals that the gains in ICT were underwritten by (further) gains in New South Wales, as well as rises in Victoria, South Australia and the Northern Territory.

And, Montgomery says anecdotal evidence suggests that recent growth in ICT comes from the “high and increasing demand” for computer security experts.

“Given that there is a shortage of trained and experienced people in this field some salary inflation is likely,” Montgomery cautions.

On the overall rise in executive demand of 4% nationally across all industry sectors, Montgomery said the increase came despite the flat Australian economic environment.

Management had the highest number of new jobs in absolute numbers, which EL says is indicative of an active employment drive occurring in the public sector, while among the states, Queensland and Western Australia registered the largest increase, followed by New South Wales, and with the ACT recording the largest monthly decrease.

"Low capital investment is taking a toll on the overall economy not just executive employment. Capital investment is a precursor of economic growth and despite continuing low interest rates, has remained sluggish.

"This is mirrored in E.L Consult's Engineering Index which has a close correlation to capital investment and has been down for some time despite the healthy construction sector.

"There is quite a lot of nervousness by the business sector when it comes to investing capital despite this ultimately being the only way to grow their top lines.

"Unfortunately for the overall economy the favoured business strategy today is to take market share from competitors not increase the market size. Investing capital is fraught with uncertainty in a world where major economies like the US, Europe and China have recessionary shocks in a conga line fashion."

EL also reports that last quarter, company profits fell 1.9% to become the fifth straight quarter of profit declines and capital investment fell to 10.5% to the lowest level since 2011.

"It is a vicious circle. Company boards are not seeing enough opportunities to justify the increased risk-taking involved in the hiring of more employees and particularly managers and consumers are not spending in case they lose their jobs,” Montgomery said.

"Business investment is now at the lowest level since the early 1990s recession and corporates are using a larger part of their profits to increase shareholder dividends.

"With returns on savings savaged by the low interest rates investors are seeking and pressuring corporations into paying higher dividends. This can only be accommodated by pulling back on capital investment."

And, EL reveals that last quarter the average payout ratio among ASX200 companies was a record 73%.

"Unfortunately investment in capital is a requirement of innovation and following innovation comes productivity and in the end it is productivity that allows Australia to retain its standard of living,” Montgomery comments.

Despite the gloom it creates, Montgomery says the recent share market volatility did not necessarily reflect the real global economy.

"Stock markets work on perceptions and expectations and there is a herd mentality in buying and panic selling. But sharp movements don't change global economic fundamentals.

"The market is in a far better spot than in 2007, for example and while the Chinese overvalued share market, with earnings ratios for most companies in excess of 100, needed correction nothing has really changed with that government's plans for growth and investment.

"The share markets around the world may be reacting to a collapse in the real China economy that in every likelihood will never occur."

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

 

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