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The forecast for IT job market growth in 2023 isn't as rosy as it once was.
March 13, 2023
During the past two months, 44,900 IT jobs have been lost amid a flurry of major layoffs and as recruitment of IT professionals ground to a halt.
That’s according to Janco and Associates. This is the first loss in the number of working IT professionals in more than 27 months.
At the same time, there are more than 145,000 unfilled jobs for IT professionals. That’s due to a lack of qualified candidates.
Janco’s Victor Janulaitis
“Based on our analysis, the IT job market and opportunities for IT professionals are very limited,” said Janco CEO Victor Janulaitis. “Layoffs, for the most part, did not hit developers. Rather, they were focused on data center operations, administrative and HR roles related to recruiting, and diversity, equity and inclusion (DE&I). Some roles, especially in telecommunications and data center operations, are being automated and eliminated. Driving this is CIOs and CFOs who are looking to improve the productivity of IT by automating processes and reporting where possible. They are focusing on eliminating ‘non-essential’ managers and staff. They will continue to hire coders and developers. The highest demand continues to be for security professionals, programmers and blockchain-processing IT pros.”
Companies that have to hire replacements do so with the caveat that payroll costs remain flat and full-time equivalent (FTE) counts go down or at least remain flat, according to Janco. Many CIOs’ 2023 IT budgets planned to increase salaries for IT pros to address the inflationary pressures faced by employees. They’re now reviewing those plans. With that in mind, median salaries for IT pros in 2023 will be 3%-4% salary above 2022 levels, not the 7-8% that was budgeted.
“According to the latest U.S. Bureau of Labor Statistics (BLS) data analyzed, there are now just over 4.18 million jobs for IT pros in the United States,” Janulaitis said. “Layoffs at big tech companies are having an adverse [effect] on overall IT hiring. More CIOs are looking at a troubling economic climate and are evaluating the need for increased headcounts based on the technological requirements of their specific business operations.”
Janco has revised downward its forecast for IT job market growth in 2023 to just over 60,000-70,000 new jobs. That will be less growth than in 2021 and 2022. But look for some growth in the second half of 2023, Janco says.
Also, CompTIA‘s latest analysis shows a relatively modest pullback in tech employment and employer job postings for future hiring. The data includes several mixed messages. Tech sector employment declined in February. However, companies added new jobs in PC, semiconductor and components manufacturing for the fifth straight month.
Job postings were down in most metropolitan areas, with a few notable exceptions. Seattle, for example, saw tech jobs postings increase by about 10% in February.
CompTIA’s Tim Herbert
Tim Herbert is CompTIA‘s chief research officer.
“The recent pullback represents a relatively small fraction of the massive tech workforce,” he said. “The long-term outlook remains unchanged with demand for tech talent powering employment gains across the economy.”
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