Following several months of disappointing job gains, June saw 2,200 new data processing, hosting and related services jobs added to corporate payrolls, a significant gain over the 100 per month average heading so far in 2016.
It was enough to grab the attention of several media outlets, including CompTIA, which noted that June employment numbers had reversed the trend.
“The IT sector grew at a faster rate than overall national employment,” said Tim Herbert, senior vice president of research and market analysis at CompTIA. “Information Technology continues to be a vital driver of growth and jobs in the U.S. economy.”
Employment in the U.S. information technology sector rebounded in June, adding a net 32,100 new jobs, according to an analysis of Bureau of Labor Statistics data. Telecommunications led the way with 28,100 jobs. However, as both CompTIA and David Foote, CEO and chief research officer with Foote Partners noted, most of that number were accounted for by the return to work by Verizon employees who had been on strike.
But not so fast, say other sources, including Computer Economics.
The rate of IT spending growth is slowing this year, “and the culprit appears to be weakness in IT hiring plans,” Computer Economics noted. Fewer than half (46 percent) of all companies surveyed for “IT Spending and Staffing Benchmarks 2016/2017” plan to increase headcount. That’s actually down over the percentages of the last two years—52 percent in 2014 and 50 percent in 2015.
Macroeconomic factors and a slow first quarter are more likely the reason why hiring isn’t increasing at a faster rate, Computer Economics explained. “While operational budgets are still growing, they are increasing at a rather unimpressive 2 percent, not much different than overall economic growth. This leaves little room for major personnel increases,” Computer Economics noted.
“Economic uncertainty makes it difficult for companies to be more aggressive in hiring new IT staff members,” said Frank Scavo, president of Computer Economics. “At the same time, virtualization and cloud services are making IT personnel more efficient, which softens the effect.”
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