This time last year, I said there was an economic slowdown on the way and that it would hit the higher skilled jobs. Our politicos said that any downturn would only hit lower skilled work. We knew 100% for certain that construction would get hammered because that industry was a bubble ready to burst. Well guess what: I am one to say "I told you so".
Dell announced layoffs with plans to relocate some work to Poland. That’s just the first trickle in that inevitable flood. I heard yesterday that Allianz is planning to layoff IT (and probably other) staff in some sort of relocation. HP have been rumoured to be relocating work. Today Avocent (IP KVM’s) are in the news with plans to make people redundant in a move to Asia. There’s been lots of other smaller firms who’ve laid off people who didn’t hit the headlines but a quick google shows them up.
Unemployment numbers are double what they were at the start of the year. The scary thing is that a significant percentage of those are high skilled workers. Most live in the commuter belt. It’s not just IT being hit either. Traditional manufacturing, construction, finance, sciences are all in the mix. IT is seen as easy to move because we have the technology to manage an infrastructure from anywhere. And it’s easy to move that infrastructure if you have virtualised.
Speaking from my own personal experience at the start of the year here’s what I reckon the newly unemployed are seeing. They’re hearing stories about firms not being able to find high skilled staff. However, a look at the recruitment sites shows there’s only a few companies hiring (through dozens of agencies at once – it’s easy to decipher the adverts if you spend the time at it so the total number of adverts is misleading). You look at the salaries and they’re paying ridiculously low amounts with demands for high skill levels. You’d be taking a massive pay cut and unable to pay the mortgage. The work is often in the outskirts of the city. Most of what I saw in January was either in the extreme north or south of Dublin, well away from public transport. North for me is a no-no because I’d be on the "south" of the infamous M50. South is just as bad because it would be 4 hours a day in the car – for a 70 mile round trip! So really, I was restricted to the my side of the city outskirts (car) or city centre (train).
I was lucky; I got a great job where I’m in a strategic position and my opinions are listened to and respected by the directors – imagine an IT firm actually listening to it’s senior IT staff! How revolutionary!!! ;-)ns
Anyway, we’re hearing more and more about "we can’t hire enough high skilled people" and "there aren’t enough people studying technology and sciences in college or university". Well guess what Sherlock, people have seen since 2002 that these graduates get paid peanuts compared to other skills and are usually the first to be laid off or relocated. Most organisations (there are exceptions) don’t value IT as a strategic asset and fail to recognise that the internal skills they have are a valuable asset not to be easily tossed away. I know of a finance firm that laid off an excellent department of 15 and had to hire in 77 consultants to replace them. Bean counters, eh?
The last time we experienced something like this downturn was back in 2000-2002. IT jobs were scarce back then. Pay for those available jobs was low, e.g. an MCSE/CCNA/Oracle/SQL/Exchange/AD expert for €18K/year – I saw that advert. But this one is different. Back then it was just redundancies and companies freezing their IT spend. Now it’s job migration to continental Europe and Asia.
What can be done? Support those firms who do stay local. Complain about support when you have that awful experience with bad phone lines and non-english speaking support engineers, e.g. HP (I had to go through 3 people in India on a crackly line to log a call about a failed EVA 8000 SAN controller – not quite the professional experience I expected for an enterprise solution). I remind every HP employee I meet about that phone call. Americans did the same and now they are seeing support moving back to the USA/Canada. If you have equal competition between vendors, one Irish located and one not, then go Irish. Spread the word about good and bad experiences. The IT industry in Ireland is very like a small village – we all know someone who knows someone, e.g. 2 degrees of Kevin Bacon.
Will things pick up? Maybe. I think the good times are well and truly over. Corporate’s want to move internationally. The cost of living has gotten too high here so salary demands have had to match. I’ve no faith in the politicos. They’ve consistently lied and mismanaged and they’re trying to make us swallow Eurocrat legislation that will introduce further job market competition within the EU.
However, the industry I’m in is busy. Native Irish firms are trying hard and generating new business. That will be what keeps this economy going. Just like in the 80’s, international firms will only stay until they find somewhere better. Native firms stick around through the good times and bad. They seem to be doing something so that’s at least a silver lining on the gray and gloomy clouds.