June 13, 2006
WashTech News
Just 76,300 new Information Technology jobs added since April 2003; New jobs total fewer than one-quarter of those lost earlier in the decade
SEATTLE, WA -- Job growth in America's information technology sector has been significantly less robust than industry leaders have claimed, and fewer than one-quarter of the IT jobs lost during the early part of the decade have been recovered over the past three years, according to a new study released today by the nation's leading union of high-tech workers. With limited exceptions, the so-called "recovery" of the IT sector has been a jobless one the study found, even though an economic recovery began more than five years ago.
The report entitled "Information Technology Labor Markets: Recovering, But Slowly" was prepared by the Center for Urban Economic Development (CUED) at the University of Illinois, Chicago for the Washington Alliance of Technology Workers an affiliate of the Communications Workers of America (WashTech/CWA).
The study examined the state of the IT industry through February 2006 (the most recent month for which data are available), assessing employment trends nationally and in eight key metropolitan labor markets. It is a follow-up report to "America's High-Tech Bust" released by WashTech and CUED in September 2004.
"Technology job growth is weak at best in most major markets across the country," said WashTech/CWA president Marcus Courtney. "Tens of thousands of highly-skilled American IT workers remain unemployed or underemployed, while at the same time-more and more technology jobs are being shipped out of the country."
Annual Percentage Change in IT Industry Employment (not seasonally adjusted)
Source: CUED analysis of Current Population Survey data.
Among the report's key findings:
Between March 2001 and March 2004, the IT industry eliminated approximately 402,800 jobs, more than half of which were shed during a time when the nation was officially experiencing an economic recovery, which started in November 2001.
Overall the high-tech industry experienced extreme employment volatility between April 2003 and February 2006, a period during which only 76,300 jobs were added nationwide. All told, the sector has recouped less than one-quarter of the IT jobs lost earlier in the decade.
While the unemployment rate in the IT sector remains above the 2001 rate of 3.6 percent, it is also likely that large numbers of IT workers have sought employment in other sectors of the economy.
The transfer to foreign markets of jobs and services once performed by American workers is a significant factor in the continued weakness of the IT labor market. Since the mid-1990s a growing array of processes and services formerly conducted in the U.S., including code writing, software design, data processing, claims processing and customer service, have been outsourced to providers in low-wage countries.
"It is far too soon to celebrate this as a strong recovery," said Nik Theodore, who co-authored the study and is a professor at the University of Illinois Chicago. "Moreover, the jobs impact of offshoring is considerable."
Employment growth in the technology sector has been uneven across regional labor markets and over time, the report found. The notable bright spots included Seattle, Washington, D.C., and, to a lesser extent, San Francisco. Metropolitan areas such as Boston, Chicago, Dallas, and San Jose have seen only modest recovery, while employment levels in Los Angeles have continued to fall significantly.
The CUED analysis contradicts recent reports from some technology trade groups claiming there are more IT jobs today than at the height of the dot-com boom.
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WashTech News
Study Reveals "Jobless Recovery" in Tech Labor Market, Despite Industrys Contrary Claims
Just 76,300 new Information Technology jobs added since April 2003; New jobs total fewer than one-quarter of those lost earlier in the decade
SEATTLE, WA -- Job growth in America's information technology sector has been significantly less robust than industry leaders have claimed, and fewer than one-quarter of the IT jobs lost during the early part of the decade have been recovered over the past three years, according to a new study released today by the nation's leading union of high-tech workers. With limited exceptions, the so-called "recovery" of the IT sector has been a jobless one the study found, even though an economic recovery began more than five years ago.
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The report entitled "Information Technology Labor Markets: Recovering, But Slowly" was prepared by the Center for Urban Economic Development (CUED) at the University of Illinois, Chicago for the Washington Alliance of Technology Workers an affiliate of the Communications Workers of America (WashTech/CWA).
The study examined the state of the IT industry through February 2006 (the most recent month for which data are available), assessing employment trends nationally and in eight key metropolitan labor markets. It is a follow-up report to "America's High-Tech Bust" released by WashTech and CUED in September 2004.
"Technology job growth is weak at best in most major markets across the country," said WashTech/CWA president Marcus Courtney. "Tens of thousands of highly-skilled American IT workers remain unemployed or underemployed, while at the same time-more and more technology jobs are being shipped out of the country."
Annual Percentage Change in IT Industry Employment (not seasonally adjusted)
Source: CUED analysis of Current Population Survey data.
Among the report's key findings:
The transfer to foreign markets of jobs and services once performed by American workers is a significant factor in the continued weakness of the IT labor market. Since the mid-1990s a growing array of processes and services formerly conducted in the U.S., including code writing, software design, data processing, claims processing and customer service, have been outsourced to providers in low-wage countries.
"It is far too soon to celebrate this as a strong recovery," said Nik Theodore, who co-authored the study and is a professor at the University of Illinois Chicago. "Moreover, the jobs impact of offshoring is considerable."
Employment growth in the technology sector has been uneven across regional labor markets and over time, the report found. The notable bright spots included Seattle, Washington, D.C., and, to a lesser extent, San Francisco. Metropolitan areas such as Boston, Chicago, Dallas, and San Jose have seen only modest recovery, while employment levels in Los Angeles have continued to fall significantly.
The CUED analysis contradicts recent reports from some technology trade groups claiming there are more IT jobs today than at the height of the dot-com boom.
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Talkback on Article
Sep 20, 2006, 7:50 pm
Its not outsourcing. Its not even the bad Market. I would say its the number of fake resumes that people are using to get Jobs. I know of people who have just graduated and lied in their Resumes as having 6 or 7 years of experience. This should stop. Firms/Recruiters should find a fool proof way of filtering genuine Resumes. I am an Indian too, But one who is trying to get a Job with a genuine Resume. And Believe me, Its Tough getting one even with a Masters Degree & over 6 years experience.
Archie, VA
Archie, VA
Sep 14, 2006, 1:08 am
the outsourcing by people who dont care at all does not make sense. if you simulate it showing the effects on other parts of the economy including individuals, in my belief, it costs more. who pays ? there is no such thing as a free lunch. but eventualy if they get their way continualy it still will end. why ? because by doing things that create excess profit at expense of workers, environment and global warming etc. Will result in world that no longer supports any life.(their creation)
Ron Glazier, Los Angeles, California
Ron Glazier, Los Angeles, California
Aug 29, 2006, 1:38 pm
One thing that I was struck by in this report...it seems to assume that IT jobs are in the IT industry. IT jobs are embedded across all industries. Many of the jobs in the IT industry that were lost were sales and marketing related, as a result of corporate consolidation (HP & Compaq merger, etc). I read/speak regularly with executives from Robert Half Technology and in some markets employer demand is beginning to outstrip supply, especially when it comes to those with business acumen.
June, Chicago, IL
June, Chicago, IL
Aug 7, 2006, 7:59 pm
I totally agree with lowboy, WE ARE STILL HERE! We're just flipping burgers and making beds,for a living,(if you can call it that). Just bought my 10 yr. old 'doublewide' hoping to survive until I can collect Soc Sec in 18 years (if it's still there). I'm surprised I have survived 4 years like this, living on credit cards and such. I can't convince my college kid to go into IT, he's seen how it truly is and lived the nightmare of almost being homeless. So I boycott outsourcing companies.
Nancy, NoneYa, Utah
Nancy, NoneYa, Utah
Aug 2, 2006, 11:58 am
Well, don't have to tell you that this trend is not going to stop. I hear ya and notice that the wages one used to earn in IT in America are gone. I also agree and understand that some former IT workers have gotten jobs outside of IT paying a lot less. Here's to BUSH. I don't have a problem with the Off Shoring Trend as long as you make my rent for an apartment or house $200 a month. Then I could work at Wendy's at miimum wage and still make my mortgage payment.
lowboy, piscataway USA
lowboy, piscataway USA
Jul 26, 2006, 10:04 am
It sounds the grass looks greener on other side but is not true. I am a Indian worker in US and have beeen replaced by some other nationality worker (not Indian). Its the corporations that has to change their perspective and not people in particular of any nation, creed, caste or religion. People are never bad but policies are.The companies need to step back and need to decide what is best in the long term not looking for short term benefits.
Gaurav, Detroit, MI
Gaurav, Detroit, MI
Jul 25, 2006, 5:17 pm
I saw a couple of Indian personnel hired; one lasted about two weeks (his experience in the position he was hired for was "underrepresented"); the second was a programming wizard and remains there to this day.
I wonder how many of these "Indian" people coming to this country, displacing Americans, are actually being lost as Indian wage earners in favor of becoming American immigrants and making wages as Americans.
Note that Indians making $2/hour wages are, according to Indian standards, making great wages. Also, this translates thus also: Indians (or American immigrants) making $20/hr or $30/hr are making, by Indian standards, vastly improved wages. No wonder there are so many Indians wanting to work in these jobs, or to come to America to work.
It's just unfortunate that Americans already here and working are getting displaced - ("unfortunate"? Riiiiiiiight.)
And I would suggest that some of these lost jobs aren't being picked up by foreign workers - some are just disappearing while remaining workers wind up with more work - and are required to be more "efficient" and are being asked to do "other duties as assigned."
When is the "work crunch" or "work overload" going to be addressed as much as off-shoring?
And what is people's take on "rural-sourcing" - the idea that companies don't look to foreign companies, or to big companies, but to rural America for IT workers....
David, Madison, Wisconsin
David, Madison, Wisconsin
Jul 7, 2006, 3:35 pm
Bill G. says american's are not skilled enough. (yah right, Mr. Bill college dropout who was lucky enoungh to have a rich, well connected mother). Okay, then explain to me why the India H1B that replaced me was not able to understand pointers in the C program. Or the next India H1B that used nested cursors when a plain SQL statement did the same thing many times more efficiently. It's all a farce, there is no shortage of technical workers. Every well written ad for a software programmer I created drew at least 200+ resumes of which half easily qualified for the position. Yah, SOME SHORTAGE!!!
jo, puget sound, wa
jo, puget sound, wa
Jul 5, 2006, 5:04 pm
We need jobs for Americans, not for unemployed foreigners. In India, there are plenty of jobs for Indians. Instead of staying there, they are coming here and taking our jobs. The increase in H1-Bs, buried in the immigration bill, will initially double the H1-Bs, and then over the next few years, will triple them. THis is wrong, and will damage US workers tremendously.
Paul, Belleville, IL
Paul, Belleville, IL
Jul 5, 2006, 5:01 am
The United States Senators, Presidents, Congress and Corporations are destroying American USA jobs and they do not care about the American People only the almighty Stock dollar, until we get back on track for the People by the People, the United States will be destroyed the same as the Great Roman Empire, its happening before your very eyes and the political hogwash they continue to pump into the media is the biggest Joke since the War.
Terry Engen, Phoenix, USA
Terry Engen, Phoenix, USA
Jun 24, 2006, 8:36 am
I agree with Brian, SF, California. We need better metrics as to what kind of jobs are lost and what kind of jobs are in demand. There are no longer any demand for key punch operators because of technology. It would be very helpful to know the breakdowns.
Brian, Chicago, Illinois
Brian, Chicago, Illinois
Jun 23, 2006, 3:44 pm
I am amazed at how few of our American friends and family outside of IT really see the significance of sending more than 200 billion a year in lost tax money (over 1 trillion dollars from the economy) to foreign countries that do not agree with us. Like many of you - I suffered unemployment after 9-11.
Wayne, Texas
Wayne, Texas
Jun 20, 2006, 10:46 am
This is just the beginning, if you believe this Harvard economist (and I think he sounds right): http://www.bos.frb.org/global2006/papers/freeman.pdf
Eric, Chicago
Eric, Chicago
Jun 16, 2006, 9:59 am
It would be great if the report showed more detailed trends. For example, is demand for C++ programmers up or down? How about Oracle DBA's? What are the specific hot trends?
The report says Washington DC is a "notable bright spot," but what exactly does that mean? Is there a growing demand for SQL Server people, or perhaps for COBOL programmers, or what???
Perhaps the union could get together with DICE, or some other job board, and tap their valuable database for this info.
Brian, SF, California
Brian, SF, California
Jun 15, 2006, 11:52 am
As an unemployed programmer; I have yet to see the "revovery". The American president is more concerned of the economy across the pond than he is in his own country. The first step to correct this is to replace the careless American president and put in someone who is more concerned of the LOCAL economy.
Richard, Keller; Republic of Texas
Richard, Keller; Republic of Texas