Payroll Gains Suggest an IT Economic Rebound

By Eric Chabrow  |  Posted 05-02-2008

A sign that the sluggish IT economy might be rebounding, IT services firms in April added more jobs than in any month since May 2006, when payrolls at firms the government labels computer system design and related services rose by 11,400.

Payrolls at IT services firms increased by 10,200 to 1,403,300 employees in April, following a 400 worker decline in workers in March, the first decline in 27 months, according to the Bureau of Labor Statistics in its monthly employment report issued Friday.

Analyzing government data, CIO Insight estimates nearly one-quarter of American IT professionals--roughly 861,000 individuals--work for IT services firms. Based on monthly household surveys conducted by the Census Bureau for its Labor Statistics counterpart, some 3.8 million employed Americans identify themselves as IT managers or staffers.

Of course, not all IT services firms employees are IT pros. According to a 2006 Labor Statistics report, IT professionals represented 61.5 percent of employed IT services workers. Managers (some of whom could be IT pros) made up nearly 17 percent of the sector's employed workers. The remaining workers held jobs in sales; office and administrative support; and installation, maintenance and repair.

In the past year, IT services firms saw payrolls increase by 57,900, or 4.3 percent. That increase is slower than what the sector has experienced over the past three years.

Since the recovery from the dot-com bust, IT services has been the most durable sector of the business-tech economy. Look at other sectors in IT--ISPs, search portals and data processing and computer and peripheral manufacturing--and you'll see less stability in employment over the years.

All figures are seasonally adjusted, and statistics for March and April are preliminary. Indeed, preliminary figures for February showed a loss of 200 IT services jobs, but the government revised that to a 1,900 gain. Though still preliminary, March's 600 drop in IT services jobs was restated as a 400 loss.