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Tech Employment Improves Last Month After Sluggish NovemberTech Employment Improves Last Month After Sluggish November

Telecommunications continues to shed jobs.

Edward Gately

January 11, 2021

3 Min Read
Job growth

Tech employment rebounded last month with U.S. IT companies adding 22,000 jobs, and the overall economy adding 391,000 IT jobs.

That’s according to CompTIA‘s review of the latest Employment Situation report from the U.S. Bureau of Labor Statistics.

The overall U.S. economy lost 140,000 jobs last month, according to the BLS report.

CompTIA's Tim Herbert

CompTIA’s Tim Herbert

“Tech hiring continues to bring a degree of stability to a still-fragile labor market in an incomplete recovery,” said Tim Herbert, CompTIA‘s executive vice president for research and market intelligence. “With projections of employer demand for tech talent remaining strong in the year ahead, we hope tech can continue to serve as a catalyst for business and career opportunity.”

The tech unemployment rate was 3% in December, compared to 6.7% for the overall economy. Tech unemployment started 2020 at 3%. It ranged from a low of 2.4% to a high of 4.6% during the year.

Strongest Job Growth

December hiring within the IT sector was paced by the addition of 20,300 jobs in IT services and custom software development. That’s an important indicator of SMB activity.

Also in positive territory were data processing, hosting and related services (+2,600); computer, electronics and semiconductor manufacturing (+1,600; and other information services, including search portals (+200). Telecommunications employment declined by 2,500 jobs.

Last year, the U.S. IT sector recorded six months of employment growth and six months of job losses. Tech employment had seven months of growth and five months of declines in 2020. Last month’s addition of an estimated 391,000 new positions represented the largest monthly gain last year.

Another positive sign was a modest increase in the number of employer job postings for core IT positions, to nearly 207,000 in December. Software and application developer openings accounted for the largest share at 62,900. IT support specialist (18,100), systems engineers and architects (16,600), systems analysts (13,700) and IT project managers (13,500) were also in demand.

Industries with the largest number of tech job postings included professional, scientific and technical services (38,215), finance and insurance (18,054), manufacturing (14,872) and information (12,406).

Negative Impact of COVID-19

Janco Associates said the IT job market shrank by 55,900 jobs last year. SMBs shed the most IT jobs, with the COVID-19 pandemic impacting them the most.

Janco's Victor Janulaitis

Janco’s Victor Janulaitis

“Larger enterprises are closing their doors permanently at a record pace, but that’s only part of the carnage,” said Janco CEO Victor Janulaitis. “The major loss of jobs for IT professions was in SMBs and the consulting firms that service them. There are over 7.5 million SMBs nationally. They have been disproportionately impacted by shutdowns. An uncounted number of these SMBs are disappearing amid the shutdowns. And the drag on the economy from these failures will linger for some time.”

Firms with fewer than 500 employees account for about 44% of U.S. economic activity, according to the Small Business Administration. Moreover, they employ almost half of all IT pros.

Until a majority of the population gets a vaccine, the pandemic will continue to put pressure on governments to close businesses and enforce social distancing, Janulaitis. said. This will hinder the speed of the recovery.

Hiring of IT pros will be hindered for the next two quarters, Janco said.

“This will continue until the public, management [and] the government feel safe to move away from social distancing solutions,” Janulaitis said. “Few companies are taking an aggressive approach to any additional spending for IT products and services.”

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About the Author(s)

Edward Gately

Senior News Editor, Channel Futures

As news editor, Edward Gately covers cybersecurity, new channel programs and program changes, M&A and other IT channel trends. Prior to Informa, he spent 26 years as a newspaper journalist in Texas, Louisiana and Arizona.

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