Shifting Talent Pool
In some respects, what's happening to oil prices is similar to what's happening to IT jobs. Just as burgeoning economies in China and India translate into more cars requiring more gasoline, that same growth means more companies--end-user companies, not just offshore outsourcers--need IT pros to help manage their businesses.
It's not only Western companies that need database administrators, security architects and systems analysts to function. And there are plenty of numbers indicating that the IT talent pool is shifting out of the United States.
ECA International, a membership organization for human resources professionals, surveyed companies in 47 countries last year and found that the United States ranked in the bottom third in 2008 salary increases. India ranked first, Argentina was second, Russia was fourth and China was ninth. And a survey conducted by global management consultancy Hay Group expects Indian salaries to rise 14.4 percent in 2008.
What's more, the Computing Research Association says that the number of incoming U.S. undergraduates declaring a computer science major plummeted by 70 percent between 2000 and 2005. Even though the downward trend appears to be stabilizing, the number of new computer science majors at U.S. universities in the fall of 2007 was down 50 percent from 2000. In addition, the total number of bachelor's degrees awarded by computer science departments with doctorate programs dropped 43 percent between 2004 and 2007, the association says.
All that has led to an ominous conclusion: Rising salaries overseas and more demand for IT workers abroad, plus fewer IT workers coming out of U.S. universities, equals hiring challenges for U.S. IT executives. The timing couldn't be worse. The U.S. Bureau of Labor Statistics projects that five categories of IT workers will be among the 30 fastest growing occupations here between 2006 and 2016, including two in the top four: Network systems and data communications analysts top the list, with anticipated job growth of 53 percent, while jobs for applications engineers are expected to increase 45 percent, ranking fourth.
Adding to the mounting staffing difficulties is the fact that IT departments need employees with ever-widening skill sets that meet the needs of the global economy. IT staffs are expected to support businesses that sell more products internationally, acquire more materials from faraway locales and do business with more overseas partners.
CIOs, in particular, are being asked to understand how international business indicators affect their businesses and ensure that systems are in place to analyze such fast-moving targets. That means they need people who understand more than software coding.
Berlin's Canter, for one, expects to hire IT staff with more international business experience. Because the company has begun sourcing many of the materials it uses in its products from partners in China, where the plastics that go into bottles, tubes and caps are abundantly available at lower prices, Canter was asked to deploy systems for managing global logistics and to track the growing influx of new materials. But since his IT staff lacks expertise in international logistics, Canter was forced to outsource the development of the needed applications. That, he says, won't be the case going forward.
"As international business becomes a larger part of our portfolio, having the [global] expertise within our internal IT staff will become a core competency," Canter says. "In this way, we can work more closely with the business in order to deliver solutions that will allow growth."
CIOs will have to get used to searching for those international skills. Their companies will need to participate in the global economy, and that will require monitoring all sorts of business indicators that haven't been as important in a domestic business setting.
"When you weren't in five different geographies, you didn't have to worry about currency fluctuation," points out Fariborz Ghadar, director of the center for global business studies at Penn State University's Smeal College of Business. "Now, currency fluctuation becomes more critical.
"If you're importing food, now you're worried about national security. Does the food have to be checked? If you're just in Ohio, none of this matters to you. But if all of a sudden you have a supply chain that goes across four or five borders, this becomes a major issue."