Tech Jobs Reign Supreme, No Matter the Industry

2013 tech-sector job cuts dropped 32 percent from 2012

By SHRM Online staff February 5, 2014
Planned job cuts announced by technology-sector firms declined by 32 percent in 2013, according to a semiannual report on tech layoffs released Feb. 3 by global outplacement firm Challenger, Gray & Christmas Inc. Employers focused on hiring in several growing areas, including “big data,” cloud computing and security.

United States-based employers in the computer, electronics and telecommunications industries announced 56,918 planned layoffs in 2013, representing 11.2 percent of the 509,051 job cuts recorded during the year. That was down from a 2012 total of 83,213—a three-year high and 15.7 percent of the 523,362 job cuts announced that year.

The heaviest reductions occurred in the computer industry, where 35,136 workers were taken off the payrolls. Still, that was 24 percent fewer workers than the 46,164 computer-industry employees who were laid off in 2012.

Annual job cuts in electronics businesses saw the biggest decline, plunging 42 percent from 14,191 in 2012 to 8,830 last year.

“The technology sector is one of the bright spots of the economy,” said John A. Challenger, chief executive officer of Challenger, Gray & Christmas. “While overall job cuts declined 3 percent last year, layoffs in technology fell by nearly one-third. Furthermore, technology consistently ranks among the areas of the economy with the strongest potential for job growth in both the near term and over the long haul.”

Hiring Highlights

Employers are focused on hiring in several growing areas, including big data, cloud computing and security. Meanwhile, sectors that can typically be counted on as strong job creators—including pharmaceutical, health care, aerospace and defense, and financial services—all saw greater layoffs in 2013, according to Challenger.

“Job cuts in health care increased 45 percent last year as hospitals and other health care providers adjusted to shrinking Medicare reimbursements and Medicaid cutbacks,” he said. “Financial services saw increased cuts among investment banks as well as retail banks, where many institutions made deep cuts among the extra staff brought in to help handle record numbers of foreclosures and troubled-mortgage refinancing in the wake of the recession.”

This is not to say there are not job opportunities in health care, financial services and even the increasingly budget-conscious federal government, he noted, but “the best and most numerous opportunities [in these fields] are related to technology occupations. In health care, programmers are needed for the further digitization of medical records. In finance, more and more security experts are needed. In the government large portions of the information-technology workforce are reaching retirement age.”

One area in particular that is expected to experience strong job growth is big data. Technology trade publisher IDG Enterprise’s recent survey of IT decision-makers revealed that nearly 50 percent of respondents are planning or implementing big-data projects in 2014.

A separate survey by one of IDG’s publications, Computerworld, found that 32 percent of companies expect to increase staffing in their IT department this year. The jobs with the highest demand include:

  • Programming/application development.
  • Technical support.
  • Networking.
  • Mobile applications and device management.

“The biggest challenge for technology companies, as well as nontechnology companies hiring tech workers, is the growing skills gap,” Challenger said. “The pace of change in the sector is so rapid, it is difficult to keep skills fresh.”

In fact, the IDG survey found that 40 percent of the respondents that are planning big-data projects in the coming year cited finding people with the right skills as a top challenge.

“Unfortunately, tech skills are not easily learned,” he observed. “It would be very difficult, for example, for someone to make a transition from manufacturing or mortgage banking into information technology. It would basically require starting from scratch, and in the time it takes to learn the skills that are in demand now, there is a strong likelihood that those skills will be out-of-date by the time they are mastered. As a result, the technology-job pipeline must rely heavily on college graduates and H-1B workers.”

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