Since the beginning of the year we’ve been barraged with forecasts and articles predicting anywhere from relatively short-term to a prolonged and a very severe recession in 2008. The experts almost all concur (even Fed Chief Ben Bernanke recently said as much) that the present day Mortgage Crisis is almost certainly going to drag the once robust US economy into a recession that could last as long as two years. The Conference Board just released April’s Consumer Confidence figures and they’re presently at a 30 year low. Heck, other than our President I don’t think there’s a single public figure not willing to go on the record and state that we’re headed for a recession. Yet, curiously there’s been little evidence of a slowdown in the I.T. employment marketplace.
So what gives? Are we living in an episode of the “Twilight Zone” where reality and the laws of gravity or should I say Economics are suspended? Or, is there something else afoot? My personal professional opinion is that while we’re all running around like "Chicken Little" waiting for the sky to fall I actually believe there are two factors that have so far kept us from realizing all the bad news being predicted to come our way. First, I believe the “atmosphere” surrounding our I.T. world is different than the rest of the economy right now and may frankly be spared more than the rest of the economy. Bull you say? Consider these two things:
- I.T. was disproportionately affected in the last recession (2001 – 2003). Due to the lack of issues associated with Y2K, the overselling of ERP, CRM and other solutions as well as the overselling of eBusiness changing everything; Companies laid off I.T. pros in droves. Newbie’s were cut, 20 & 30 years pros were cut, Developers, Managers, and Analysts. You name it and they cut it. The point is that firms cut deep, too deep. The real point is that 5 years later they still haven’t staffed back up to those previous levels. There’s simply less “fat” to trim.
- Moreover, companies have outsourced many of precisely the kind of jobs they can most easily cut in lean economic times. The low hanging fruit has mostly been outsourced. There’s more of course but not a lot and not nearly as much as you’d expect in a recession. What remains in today’s I.T. shops are business focused/ aligned and much more critical to the successful operation of the firm. Simply put, it’s not your Father’s I.T. world.
- Last and this is purely anecdotal, I believe that intelligent companies realize now more than ever before that one of the keys to survival during trying economic times is “productivity.” Productivity is the providence of technology which of course is the coin of the realm of I.T.
This may all be hogwash. If you think that please post a comment and I’ll be happy to provide further information backing up my beliefs. Either way, the fact remains; the Recruitment and Placement business continues to do very well and America’s CFO’s must agree since they simply don’t continue to approve funding for FTE staffing when they are worried about a recession.
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