Watching the trends of the it industry has become a spectator sport in recent months. Stock market fluctuations have led to mass layoffs at tech firms, which have led, in turn, to more stock market fluctuations. To business people simply trying to take care of their own IT, it can all be somewhat distracting.
In our magazine's news section, we occasionally run statistics on the labor market for IT professionals. A recent survey by the Information Technology Association of America (ITAA), for instance, reported that the number of new IT jobs created this year will be "only" 900,000 (1.6 million were created in 2000). That 900,000 is a staggering number, especially considering that most of the 7 million-odd small businesses in the country don't have a single IT staff person. While the ITAA study does discuss what it calls "small companies," it doesn't count any below 50 employees, and it includes companies in the tech industry among the ones it does count.
In general, small businesses turn to VARs and consultants for support, but the costs of their services are still tied to the cost of the people they employ. And the tech labor market would have to contract much more before tech help will become affordable. "A shortage of labor supply, in general, still equals higher consulting fees," explains Tinabeth Burton, the ITAA's vice president of communications. "Holding onto IT workers, whether they be freelance or in-house, may continue to be difficult."
All tech jobs aren't created equal, and many require specialized knowledge that drives up their price. Techies climbing out from failed dot-coms probably would consider themselves overqualified for the mundane yet important IT tasks that occupy a small business' attention. "If you're a small company, it's harder to find someone who can do everything," Burton says.
Even when a small business can attract a talented IT expert, it runs the risk of training that person right out of its price range. Consider this: More than 80 percent of the companies in the ITAA's study report that they offer new, entry-level hires at least one level of potential promotion. Once they've trained them, these hires have somewhere to go.
Finally, there's the issue of compensation. The ITAA reported, unsurprisingly, that getting paid well is the incentive employees most often cite as a reason for sticking around. In tough financial times, businesses will have a harder time coming up with the cash, even if a softening labor market drives salaries down at the same time. In the ITAA's study, the demand for IT workers at non-IT companies -- the vast majority of which qualify as what the authors call "small" -- was only a little more than half what it was last year. "For a small business, the answer is often to find creative solutions," Burton explains.
We're all familiar with such "creative solutions"; sometimes that's just another term for making do with what you have. In the case of day-to-day maintenance, that might be fine. For important decisions that involve the future of the company, however, you had better call in a consultant.
Here, again, big companies have enormous advantages. "They've got the money to hire multiple consultants," says John McKiernan, director of Boston College's business development center. That means they can hire one to review another consultant's proposal and to make sure they meet the terms. No wonder there's such high demand for jobs.
IT is by no means easy to understand. The difference between a good application and a bad application, a successful installation and a failed one, can come down to a few incorrect commands or unruly bits of data. It's hard enough finding someone who can understand all the technical aspects. Add to that the task of finding someone who understands your business, what you can afford, and what you want to accomplish. Finally, try finding someone with whom you can discuss the company's real goals and limits.
"In a small, closely-held business, who are you going to talk to for advice?" says McKiernan. "You just can't be that open." For all the businesses that do manage to find capable, compatible, and trustworthy IT help, whether they are consultants or full-time staff members, there are dozens more who'd love to know the secret.
But that would make them that much harder to hold onto, wouldn't it?