One of my clients remarked this week, “Is it pushing the barrow to say Happy New Year in February, or should I ask what you’re doing for Easter?” Well whichever greeting you choose you can be sure that the year has begun in earnest now that Christmas and school holidays have all but been erased from memory. And don’t get me started on the summer that never was!
Over the past twelve months, our Business Engagement team have noticed a clear distinction in relation to demand for resources within different industry sectors. Whilst the strains on the European Financial Market continue to deepen, the larger banking organisations especially those with a significant international presence are sitting tight, reticent to commit to large projects in 2012 until the true impact of the current financial storm are realised. On the other hand, there are a number of local financial services companies especially those in the insurance, mortgages and commercial finance industries, who are optimistic and are pushing ahead with core system replacement projects and ecommerce transformations to catch up with their peers in the banking industry. For many the opportunity cost of not having strong online presence and the lack of investment in newer technology platforms far outweighs the initial outlay for modernisation projects which will ultimately result in increased efficiency and greater opportunity for revenue generation.
Our Commerce and Industry clients in contrast have seen clear spikes in recruitment over the past twelve months with further large scale projects scheduled for next year. The trends in this sector are still very much in the pattern of acquisition and consolidation as some of Australia’s largest players come together with the likes of the acquisition of Franklins by MetCash and a number of conglomerates looking to consolidate their IT environments. Mining, Engineering and Energy companies are still hiring at a senior level, alongside construction and property companies. All indicators are that it will be a big year within the Telco space for large scale transformational projects across customer service and life-cycle management with analytics. Again in this sector trends are around mergers such as VHA and 3 Mobile which is driving consolidation of their platforms, upgrades and migration projects, alongside the ongoing NBN programme of work which continues to suck up resources. Project sizes within this space are ranging from $20M to $400M and anticipate to get underway in Q1 2012.
What Next?
The application development & support market has remained in a positive position throughout this year with only the upcoming holiday period stalling the slow but steady momentum. We have seen demand in the usual areas predominantly led by .Net & Java but we are seeing most demand and probably the shortest supply in tier one ERP skills (mainly SAP & Oracle), Microsoft SharePoint, Front End Web and Mobile Development. With that in mind the demand for contractors skilled in Agile development methodology continues to rise, as companies move away from large scale in house software development programs in favour of quicker rapid deployment of products and services. When companies do commit to large scale software programs they are looking to utilise a combination of in house resources, contractors, local specialist service providers as well as global outsourcers. This creates greater spread of risk on key deliverables, flexibility with resources but major challenges in vendor management, accountability, communication and ultimately decision making.
Companies are increasingly looking at consolidated ERP systems with Oracle and SAP taking a majority market share but we have also seen a number of companies committing more capital expenditure to JDE, PeopleSoft and Seibel upgrades as in most cases they offer a much more cost effective solution rather than the larger investment needed to implement Oracle or SAP. You will see from our salary review that SAP Basis & Oracle Database Administrators have experienced the largest rate & salary increases due to high demand and increasingly low supply. We have also seen a similar trend in demand for HR/Payroll consulting skills across most of the major ERP products. Due to the shortage of available skills in this area we have seen companies bringing resources from overseas to meet demand on critical projects. As with any technology skills shortage there has been a large push from candidates looking to enter the contracting market in order to take advantage of higher daily rates, this in turn has led to a large number of permanent positions being left open for 6-12 months.
What Next?
With 2011 drawing to a close it’s now a great time to reflect on those early year predictions to see just how right or wrong we got it. There is often a sense of market strength or weakness that permeates business confidence way before the figures and analysis come about to prove or disprove.
The Reserve Bank of Australia (RBA) earlier this month cited wages as one reason why it cut interest rates by a quarter point to 4.25%, the first easing in over two years. This was supported by comments on the marked slowdown of employment growth where market caution has seen the jobless rate climb up to 5.2%, from a low of 4.9% back in April.
Already the predictions for 2012 are coming thick and fast with the usual swing of opinion; from optimistic growth on the back of sustained demand from China for our resources, to pessimistic claims of decreased consumer spending, a failing housing market and ongoing effects of the European economic financial crisis. Read more…
The year is now in full swing and despite the worldwide market volatility of recent months; it’s still a pretty positive environment in which to operate a business here in Australia. This week saw the release of a number of pieces of positive data on the Australian economy.
Gross domestic product (GDP) rose by 1.2% in the three months to the end of June from the previous quarter, the ABS said. That compares with a contraction of 0.9% in the first three months of the year and an equivalent growth of 1.4% for the same period last year.
Read more…
Australia has one of the strongest economies in the world and with that comes some of the highest salaries in the world, particularly in the technology field.
Having recently arrived from the UK, what I have realised is that IT professionals are getting paid substantially more here for the same job. Graduates are commanding salaries which even Senior IT professionals would struggle to get in some parts of Europe. I appreciate there is a slightly higher cost of living here, but the difference outweighs that by far.
Taking that into account, I have been surprised at how demanding and inflexible some IT professionals are in terms of their salary requirements.
I can totally understand that we all want to get a pay rise and that we have mortgages and families to consider. However, I have known some IT experts to refuse to move unless they get a $30K pay rise – irrespective of the job and career prospects on offer. Others I know that have been out of work for months with and have turned down offers in fantastic companies and great working environments – because it means taking $5K less than they were on previously. When you are earning upwards of $140K and around $40K more than you would in any other country, I can’t quite believe $5K here or there would be a showstopper. Read more…
With a 10% predicted increase from 2010 on IT spend globally there are a number of trends we are noticing specifically within the banking and financial services sectors.
Regulatory change, with tighter requirements for the likes of APRA is driving much of the current recruitment requirements around increasing the reporting capabilities for many of these organisations.
There is also an increasing number of large scale modernisation and transformation programs of work across large and small clients driven by the fact that most organisations haven’t made a significant investment on technology spend for the past 10 years. Mobile banking functionality is also a hot topic currently especially with the likes of Bankwest implementing a new website utilising an online shopping tool which provides a shopping basket type of functionality.
Cost reduction is still the big challenge for CIO’s and this in itself is driving the demand for consolidation and unification of global and regional technical operating platforms.
The first quarter of 2011 closed for many Australian Technology businesses with a solid, if not superb start to the year. The economy continues to build with positive momentum evidenced by a number of positive economic drivers.
Read more…
2011 is the Chinese year of the Rabbit; “a placid year much welcomed and needed after the ferocious year of the Tiger. Forecasters talk of good taste and refinement which will shine on everything whilst people will acknowledge that persuasion is better than force. It is a time to watch that we do not become too indulgent but at the same time take advantage of the fact that money can be made without too much labour. Our life style will be languid and leisurely as we allow ourselves the luxuries we have always craved for. A temperate year with unhurried pace, for once it may seem possible for us to be carefree and happy without too many annoyances”.
Now I’m not one to read too much in to horoscopes but with wishful optimism I’d like to think that if even half of this comes true 2011 should be an excellent year.
The technology recruitment market started without much delay in the very first week of January as pent up demand from the end of 2010 rolled over the holiday season and quickly surfaced in the form of increased job advertisements across the sector.
This year here at Ambition we’re committed to talking less about skill shortages and more about skill re-alignment. It’s clear there is an imbalance between the supply and demand of certain niche skill sets but what’s equally clear is the need to address creative albeit often simple solutions to train, mobilise and deploy people in to those areas of strong demand.
In this edition of the Ambition Technology Market Trends report:
As usual we are always keen to hear from you, please leave your comments, questions or suggestions in the comment section below.
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Ambition Technology Market Trends Q1 2011
In the office my colleagues call me the Christmas Grinch, Bah Humbug and The Scrooge so to make sure I live up to my reputation I will not mention a thing about that C word!
The Year 2010 in Review
January 2010 – This was a crazy period of time for me, recruiting in the infrastructure space during January was like opening the flood gates. Budget had finally been allocated for extra head count after the GFC and managers didn’t hold back. They wanted to make sure they gave some relief to their teams before upper management changed their minds. This is traditionally the quietest month of recruitment in the year but definitely not for me in 2010. This was a good sign of things to come for 2010.
February > May 2010 – Things incrementally picked up from here as more and more uncertainty was waivered and good financial results gave companies across various sectors more budget for both permanent and contract positions. Although there were additional requirements and companies were performing well there was still the hangover of the recent GFC on everyone’s minds and threats of a double dip recession kept salaries and over hiring down. Overall, steady increases in hiring and vacancies for Infrastructure professionals continued throughout the first two quarters of 2010.
June > August 2010 – The Infrastructure recruitment market plateau happened during these months but projects started to kickoff and the business information team were very busy throughout these months employing PM’s, Business Analysts and various project leads / designers. This would impact the infrastructure market later on down the track in 2010 and 2011. Throughout the year to date companies had been cautious not over doing salary increases and were being very selective with who they brought on board to their teams. With the steady increases in staff hires throughout the year the first signs of real skilled staff shortages started to peep through the cracks and recruiters were starting to find it harder to deliver on client requirements. Honest and Smart Recruitment Consultants indicated these changes in the job market and set realistic expectations with their clients. Read more…
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