May 2009

Less money for IT workers

WA few months ago top IT workers could demand almost any pay package they wanted. But, as the recession starts to bite, things have shifted and now employers are the ones calling the shots, said Karen Geldenhuys, MD of IT recruitment company, Abacus Recruitment.

“Employers are tougher on general salaries and fees for contractors now, without a doubt. It is no longer an IT worker driven market. Employers are calling the shots. We are finding that the big banks are still hiring, but they want ‘pounds for their flesh’ and the employment process is now lengthier. They are being more thorough when choosing staff – there is no place for largesse.”

Geldenhuys said that while retrenchments in the IT industry were, until recently, not an issue, the latest statistics show that companies are starting to retrench IT workers. “Despite our skills shortage in the IT sector most sectors are now looking at head counts. IT is no longer escaping the downward trend. That is worrying. Our clients are also pushing us to drive down our recruitment fees, although we are placing, more or less, the same amount of personnel. But, definitely, the global meltdown is starting to make itself felt here in SA from an IT hiring perspective.

“We are working harder for each Rand we earn as a recruiter,” she said.

Commenting further, she said this signifies a “big shift” in the marketplace. “This is a noticeable shift. We are now working as hard as we were in the Y2k crisis at the turn of the century. Additionally, smaller companies who are battling with cash flow are going to the wall but, interestingly, the bigger players are swallowing up all the slack and are choosing the cream of the crop from a hiring perspective. Unlike in the USA and the UK – with the credit crunch – it is not the big companies going to the wall in SA. Small and medium enterprises are being hard hit. This is sad, because this is where a lot of the employment growth came from until recently.

“But it is certainly true – from our experiences – that IT workers who are in demand can no longer just demand stellar pay packages. The shoe is now firmly on the other foot. They are not in the driving seat, that is for sure.”