Wired women: Stop expecting double-digit IT growth

IT is bouncing back, but the days of double-digit expansion are long gone, according to one of the industry’s most prominent researchers.

Jan Duffy was part of a panel speaking on the future of the IT industry at the Elizabeth Beeton Auditorium in Toronto last week. The event was organized

by the Toronto chapter of the Wired Woman Society.

“There will be — and is underway — a mild recovery in the IT sector in this country, although there is a chance of some thunderstorms,” said Duffy, group vice-president, solutions research, IDC Canada. “You’ve had two years of negative growth and 2004 could well be a turnaround year, although we’re not predicting it to be a complete breakout year.”

Overall, said Duffy, IDC Canada is predicting about 2 per cent growth. Hardware is holding steady and software’s expansion is in the 2 per cent to 4 per cent range, she said. The big deal this year is likely to be in the services sector, Duffy predicted.

Driving the growth of the IT sector overall will be replacement cycles, pent up demand and competitive market threats, said Duffy, with the national economy and IT price deflation and credibility working as inhibitors to that expansion.

The industries that typically consume large amounts of IT have a different flavour one from another, said Duffy. In the finance and insurance sectors, for example, many of the players are trying to grow; but because they’ve been pushing mergers and acquisitions it could mean a holding pattern for IT for about a year in those fields until they sort themselves out. Once that’s done, however, finance and insurance will become prime IT opportunities, said Duffy.

Sandra Palmero, director of business planning and operations, Microsoft Canada, said the software giant believes it’s not all gloom and doom in the IT sector.

“We (Microsoft) think where we are at this point in this industry is probably the most exciting point it’s been. I’ve heard Bill Gates say on several occasions that the next 10 years will be far more exciting and innovative than the last 40,” said Palmero.

People in the IT industry got used to double digit growth and acceleration and it was a real high to be part of it, she continued, so the dip between 2000 and 20003 came as a shock. “As we look ahead, out to 2007, we see that we are going to rebound and come out of it. But even looking optimistically at the future, we’re probably only looking at single-digit growth,” said Palmero. “I think what will really change moving forward is the need for companies to be very, very relevant with what they’re doing. No longer will innovation for innovation’s sake get us anywhere.”

Companies and individuals will demand value, and vendors such as Microsoft are going to have to deliver it, said Palmero.

Patrick Sullivan, president of online job site Workopolis.com, said the number of IT positions posted on his Web site is growing significantly and is further evidence that the industry is bouncing back. On March 30 Workopolis.com had more than 2,800 tech jobs listed, said Sullivan, an 80 per cent increase over the same period last year.

“”We’re seeing significant growth, but we’re seeing a different kind of growth, he said. “Through the dot-com boom everybody was hiring everybody. What we’re seeing now is what we call ‘network infrastructure’ positions.”

Workopolis.com defines network infrastructure as network security, hardware-related jobs, network technicians, security analysts and systems administrators, among other occupations.

The customer service job segment — help desk, technical writers, quality management and so on — is also robust, Sullivan said. Comparing this year to last he said customer service positions posted on Workopolis.com are up a whopping 173 per cent.

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