Careers: IT Still Plans to Spend Despite Salary Cuts

Along with IT pay cuts, there's a bona-fide IT spending counter-trend, analysts say, but who will benefit?

If you were waiting for the other shoe to drop in these times of uncertain IT employment, this might be it: a new IT skills and salaries survey reports that IT pay posted its first decline since mid-2004.

That's the bad news. There's good mixed with the bad, however: pay for some IT specialties -- e.g., architectural, methodology and process, database, security, networking/communications, and project management skills and certifications -- continues to rise despite the economic crisis.

Those are only two of the conclusions from salary and compensation researcher Foote Partners, which periodically assesses the health of IT pay. According to CEO and chief research officer David Foote, the average market value for 179 noncertified IT skills dropped by half a percentage point in the last quarter of 2008. Compensation for certified skills fared even worse, according to Foote, dropping 1 percent over the same period and nearly 5 percent for the year.

Although IT pay is declining, Foote concedes, he cites a counter-trend -- unique in his experience -- in which certain skill areas continue to be in demand and command salary increases.

"It was inevitable for skills to start reflecting the hard times we're in," Foote writes. "This is not the first time in ten years tracking skills and certifications pay and demand that Foote Partners has witnessed corrections brought on by economic conditions. However, the major difference in this instance is the counter-trending, especially in architecture and methodology and process skills."

Foote says companies don't seem to be reacting to this downturn -- in spite of its ostensible severity -- as much as they have in past downturns. "Clearly, an urgent demand for talent in these areas is eclipsing broad, knee-jerk reactions to reducing budgets and cutting people, projects and purchases that have been characteristic of IT management decision behaviors in past recessions," he says. "Those times were often marked by lack of careful forethought about the future consequences of budget decisions."

In past downturns, Foote asserts, employers tended to over-react, making deep cuts to budgets and head counts. So far, it appears that employers are resisting cost-cutting hysteria and are trying to strengthen their positions in the midst of admittedly disruptive economic conditions.

"The fact is that employers made mistakes in past downturns -- huge miscalculations in the heat of cost cutting -- that limited their options when the smoke cleared and they were without the experience and specialized skills needed to rebuild the business," he notes. "Employers are obviously now aware that continuing to invest strategically in IT skills and labor is the smartest thing they can possibly do to make it to the other side of this recession as stronger, undiminished enterprises."

Strengthening means spending, and in 2009, IT dollars will be funneled into strategic initiatives -- such as boosting automation.

"[I]ncreasing process efficiency through the adoption of software automation and workflow tools is a popular recession budget strategy in 2009, evidenced by sharp increases in pay and demand for ITIL, CoBIT, and similar skills," Foote indicates. Such skills are prized for a variety of reasons, he continues: "While valuable in short-range cost reduction initiatives, these are also core enterprise skills with high re-use value long-term."

ITIL and CoBIT jprofessionals won't be the only beneficiaries of the IT spending counter-trend. IT professionals with skills in network, security, and other architectural areas will also be in hot demand -- both during the ongoing economic tumult and (notionally) after the debris has settled.

"A wide range of architecture jobs and skills have been in hot demand in the last few years," Foote concludes. "They will still be hot commodities long after the economy improves. But staffing and talent development in this area does not come easy or cheap, and most employers are well behind the curve. Even those who have invested heavily reveal … that they have insufficient IT architecture-related resources."