NBN skills demand to kick along IT salaries

Appeared in: ITwire
Author: Beverley Head
Date: Tuesday, 16 February 2010

After being hung out to dry by the GFC triggered downturn, demand for IT skills is on the march, and with NBN Co predicted to enter the recruitment market in earnest from May, salaries are tipped to rise too.

IT recruitment specialist Peoplebank Australia says that already in some niches skills demand has surged by as much as 218 percent over last year – and the firm is predicting a return to IT skills shortages in some areas by June.

According to Peter Acheson, chief operating officer of Peoplebank, NBN Co is expected to start hiring in earnest in May. “They are talking of hiring 2,500-3,000 employees. But in the course of all the projects there could be 55,000 people on different projects.”

This could prove a catalyst for salary increases. “That’s part of the assumption around rates. Their starting to hire will put pressure on rates,” Acheson told iTWire.

NBN has of course felt its own recruitment pressure in recent weeks with the row over the appointment of Mike Kaiser to the $450,000 a year government relations and external affairs role. Kaiser appears to have faced little competition for the job – and IT workers may find themselves similarly unchallenged as demand rises in a market with only limited supply of some skills.

Peoplebank believes those IT skills in shortest supply will be among contract workers with business analysis, project management, and Web 2.0 skills or experience in banking, utilities or resources.

Demand for IT skills is strongest in NSW, Victoria and WA.

It also comes on the back of strong employment news coming from the Australian Bureau of Statistics last Friday which showed that Australian unemployment stood at 5.3 per cent in January – a fall of 0.2 per cent on the month before when seasonally adjusted.

The number of people in jobs rose 52,700 to 10.97 million – the largest rise in employment since December 2006.

While Peoplebank’s January review of salaries and contract rates paid in more than 50 IT job categories showed salaries have remained unchanged from the figures collected in November 2009, the company has seen a strong hiring demand likely to put upward pressure on rates.

“Peoplebank had an uncharacteristically busy January. In an almost complete reversal of the situation that existed 12 months ago, some 40 of our top 50 clients – Australia’s largest banking, government and enterprise IT users – made new hires in January, as well as flagging their intentions to continue hiring in the coming months.”

Acheson said that there were some signs of improvement from July last year, while November and December had “really heated up.” The first two weeks of February had seen strong demand, and he was optimistic about the remainder of the year.

This growing demand was putting the heat on employers as job seekers understood the market was on the move.

“We have a market that’s fairly thin for IT candidates. Employers need to respond to salary requests or lose them (staff),” he warned.

According to Peoplebank, NSW demand is led by the banking sector, with two of the four majors involved in core systems revamps. Banking and utilities led demand in Victoria with resource projects fuelling IT skills demands across the board.

In NSW permanent roles increased 32 per cent compared to the same period in 2009, while contract roles have risen 20 per cent in the same period.

In Victoria Peoplebank said the year had begun with a ‘bang’. While the State’s Government IT agency Cenitex might be trying to offload contractors and hire mainly permanent workers, roles in the contract sector have risen by a stellar  218 percent over the previous year, while permanent hiring has increased by 27 percent on January 2009 figures.

In West Australia demand for IT skills rose 40-60 per cent.

The other states and territories enjoyed flat or modest growth.