After enduring several years of layoffs and uncertainty, there’s some evidence to suggest significant improvements are in store for Canada’s IT sector.For starters, companies are spending more on IT products and services. In 2005, profits in the IT sector were expected to rise to $6.3 billion, an increase of 4.5 per cent over 2004, according to the Conference Board of Canada.
There’s also good news on the employment front. In its High-Tech Compensation survey, Mercer Human Resource Consulting states companies are projecting average salary increases of 3.4 per cent for their high-tech workers in 2006. It’s a marked improvement over the last several years where many IT professionals have had their salaries frozen.
During the past five years, companies have dramatically reduced their training budgets, and that’s hurt both the economy and productivity, says Greg Ambrose, program manager of eLearning and skills development at IDC Canada.
“It’s really forced organizations to make due with what they have and pursue shorter-term solutions rather than longer-term strategic investments,” he says. “So, there’s been an increase in the use of contractors as some have found other ways to address their business and IT challenges.”
But the tide is changing. Ambrose says over the past six to eight months in Canada, companies have begun to refocus around where they can drive value.
“They’re investing in infrastructure and looking at IT to solve business challenges — and become the differentiator ,” he says.
That point is underscored by the fact that one IT recruiter has seen the demand for permanent IT staff outpacing that for contract workers.
“Overall, we’re seeing a continued demand for our services, even in times when we would expect to see a downturn ,” says Chris Drummond, vice-president at CNC Global, a Toronto-based company that specializes in IT recruitment. The firm, he says, saw its best third quarter results in 36 months in 2005.
Drummond says most of the demand is for employees who have infrastructure experience as well skills in the areas of Web development, e-commerce and security.
Hardware support, network support and administration, help desk and similar roles still make up about one-quarter of the demand, depending on the region. Web developers and e-business specialists are also popular with Canadian business, comprising 20 per cent of the overall demand. Drummond says project managers and business systems analysts continue to remain an important category in IT marketing, as collectively they make up approximately 20 per cent of requirements.
According to CNC’s client base, the top technical skills employers are seeking are Java, Unix, Oracle, SQL and J2EE. Drummond says it’s also a challenge to fill some of the high-end security specialist positions as well as enterprise resource planning jobs.
Meanwhile, Robert Half Technology, another IT recruitment firm in Toronto, says its survey of 270 chief information officers in Canada reveals a net hiring increase of seven per cent across the country. Most of the activity will be seen in the business services, finance and construction sectors. Executives at the largest companies were the most optimistic about technology hiring, with almost a third of them saying they plan to add staff this year.
Robert Half’s IT Hiring Index states that more than three-quarters of CIOs are looking for workers with Microsoft Windows (NT/2000/XP) administration expertise. Cisco network administration and SQL server management was also cited by 36 per cent of respondents, followed closely by firewall administration (35 per cent).
For retired IT workers considering careers as consultants, the prospects are bright. Drummond says the industry will experience some serious talent shortages, especially in senior, niche roles involving legacy systems.
“We have an aging work force, and that’s creating problems for some of our customers,” he says. “They’re starting to talk about it in terms of knowledge transfer. One of the things we’ve commented on many times is how mainframe programmers are a dying breed and there’s just not a lot of people coming on board.”
And there may be more talent shortages on the horizon. Many post-secondary institutions specializing in information technology programs have reported declining enrolment over the last few years, and that means not enough workers to fill the spaces that are opening up. Drummond is not surprised to see fewer young people opting for careers in information technology given the amount of media attention the downturn garnered.
“I don’t think it’s a big mystery,” he says. “The market softened after dot-com, and then we heard about offshoring. Many people began to look at IT as not a very inviting career choice.”

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