Study finds dramatic loss of tech jobs

Job trimming at technology companies took off during the past three months, according to a new report.

Announced job cuts in the technology sector hit 54,701 in the third quarter, up 60 percent from the second quarter and 14 percent from the third quarter of 2003, according to a report Monday from employment services firm Challenger, Gray & Christmas. Challenger defines the technology sector as computer, electronics, telecommunications and e-commerce companies.

John Challenger, CEO of Challenger, Gray & Christmas, blamed the cuts on pricing problems in the sector. "High-tech job cuts are on the way up as the end of the year approaches. Behind this trend is the fact that technology companies have virtually no pricing power," Challenger said in a statement. "Even as demand increases, most manufacturers and service providers are getting less money for each unit sold. They are forced to cut costs to maintain healthy profit margins."

The report adds to the mixed signals that have emerged about the information technology job market. Technology services companies like IBM and BearingPoint are hiring in the United States, though they are increasingly looking for employees who can combine technology chops with business savvy. Payroll employment in computer systems design and related services hit 1.14 million in September, up 32,700 since September 2003, according to the U.S. Department of Labor. And research firm Meta Group recently predicted salaries of IT staff will increase by as much as 15 percent over the next three years.

On the other hand, tech workers face the threat of "offshoring"--when tasks such as programming get sent to low-wage nations. A recent study from the Information Technology Association of America found that hiring managers have less ambitious plans for filling IT posts this year compared with last year. What's more, a measurement of IT workers' confidence in the job market dipped in September.

So far this year, high-tech companies have announced 118,427 job cuts, which account for 16 percent of the 724,320 announced job cuts in all industries through Sept. 30, according to the Challenger report. The percentage of high-tech cuts has increased since the second quarter, when they represented 13.5 percent of all job cuts, Challenger said.

Challenger's statistics refer to announcements by U.S. companies about work force reductions, and can include layoffs, jobs lost through attrition and early retirements. The numbers can include job cuts that U.S. companies make in units outside the United States.

According to the report, about 56 percent of the third-quarter job cuts, 30,624 positions, came from computer companies--manufacturers and distributors of computer hardware, software, parts and peripherals, plus computer service companies.

"There are certain areas in the technology sector that are thriving. Demand is high for those who specialize in network and IT security. Tech support is another area looking for people. However, it could be some time before overall technology job creation returns to the pace we saw in the late 1990s," Challenger said. "That may happen only when baby boomers begin leaving the work force en masse due to retirement. At that point, many industries, including technology, could be struggling to find skilled workers."

[Razzl]

It's okay, Bush is going to send you all back to community college...

Jeez, what are you guys worried about? Didn't W tell you he'll send you back to community college to get more education so you'll be more fit for the jobs of the future? What's that--you already have a MASTERS or a PHD? and you work in the Tech sector? Well then, you're good to go! We've just got to give a few billion millionaires some more tax breaks so that money can find its way down to you--hang in there...

[VbMan]

READ MY LIPS (I LIE! ~Bush)

Both candidates are equally able to manage the war. So if you vote Bush you are directly affected by job outsourcing. Remember the 80's and 70's when we were auto leader of the world? When the cheap imports practically killed our steel and auto industry/ Well unless we take Kerry's plan to tax outsourcing we will become number two or three. This crap that Bush will send you to community college will do no good for us. The CC Colleges cannot take me above the level of amateur programmers. So that argument is crap! The next battleground is the virtual real estate space. If we start losing IT jobs or outsourcing this overseas IF you do get hired your pay rate will be lower because of the competitive pay rate overseas. Bush does not have a true understanding of IT, did you listen to the last debate? He said, with IT our health industry will be able to cut costs, I don?t know about you but I know the health industry has adopted IT years ago and they push the boundaries. Bush is a puppet and a hack. Does it not bother you that this guy has not had one successful business endeavor? I know IT engineers, project managers that can handle these issues with logic a lot better than him. I am republican and disappointed by the IQ of this man. Kerry has a better plan for us. Keep our jobs here. Don?t let this be a repeat of history when our auto industry almost went under due to cheaper imports. We are IT, we are AMERICA we must lead the world to stay number one.

[pentium4forever]

President Bush is for jobs overseas!

This is another reason we need to get rid of President Bush. Not only does he say "internets" instead of "internet" but he also doesn't understand the potential in all the possibilities technology and science brings to the future. Look at stem cell research. We need John Kerry for President so we can simply get jobs and not be told to get the job if agreeing to go over to India! Customers like people they can understand no offense but it's true.

Again, the main point is missed

The real responsible parties are the Harvard educated CEOs and board members. They have taken the salaries of american IT workers and used them as allowances for their spoiled brat children and grand children or to buy that neat ship to cruise around in. Super greed has continued to bankrupt our economy by continuing to concentrate wealth in the few greedy morons of corporate america.

Little do they understand or care that the ability for their companies to make a profit will ultimately be destroyed because the very people they are laying off are (excuse me, were) the main clients of their products. This is the same type of crap that lost IBM the top PC marketplace in the 80s.

An unemployed (underemployed) IT worker with degrees in physics, mathematics, and computer science.

John J. Viescas