General Overview
Despite the downturn of a few years ago, the IT sector in Ireland continues to offer good career prospects. During the late 1990s, technology businesses belonging to the so-called new economy were valued on their potential to perform in the future rather than on the basis of current performance. Investors and IT graduates were attracted to these companies by the promise of high salaries and attractive stock options. However, many people lost their jobs when numerous dot.com companies failed, and it took the industry some time to recover its strength. Ireland, however, was relatively fortunate, as a strong IT sector was employing most of the available talent, and there wasn’t all that much space for dot.com firms.
Ireland remains an attractive location for investment in information and communications technology. Seven of the world’s top ten global IT companies have substantial operations in Ireland. The sector employs almost 100,000 people and accounts for more than a quarter of all Irish exports, worth over €25 billion annually. Ireland is one of the largest exporters of software in the world, and eight of the top ten software suppliers in the world have operations in the country.
According to Siobhan Ryan, HR and resourcing manager at Dublin-based IT firm Ergo, the market for IT staff has experienced a shift in 2008, with an increase in demand for permanent staff and a decrease in demand for short-term contract staff. Ryan says that this is because companies, reacting to more turbulent economic conditions, are seeking increased stability. Ryan is very optimistic about the future of employment in the IT industry. She says that companies based in Ireland will continue to seek the competitive advantage that IT can give them. She says that September 2008, after the typically quiet summer season, will see a buoyant market in which employers will have an excellent opportunity for the first time in five years to source good candidates. She envisages a shortage in candidates approaching Christmas after this period of strong recruitment.
According to Steven Grant, managing director of Oriel Recruitment, the recent downturn in the financial services and banking industries, big employers within the IT market, has had somewhat of a negative effect on IT recruitment. Grant says that demand for project managers and business analysts within those sectors has slackened but that recruitment for critical positions is still moving ahead. Grant adds that demand for employees in such areas as customer relationship management (CRM), pharmaceuticals, and software development is making up for the weakness in the financial services arena.
Ian Duncan, director and practice leader at IT consultancy firm Vision Consulting, says that there has been a shift in the industry, with the number of candidates slowing down as employees stay in their current jobs due to concern about the economic climate. According to Duncan, it is difficult to get quality people in the contract market with good track record. He says that it is also hard to find the type of commitment-oriented project managers that Vision Consulting needs.
Areas of Shortage
There is a currently a candidate shortage across most areas of IT, especially for candidates with a blend of good IT skills and industry specific experience i.e. business analysts and project managers in the financial areas of security, audit or compliance. Development skills including Java, J2EE, C# and .Net skills are also in demand as are good automation testers and test and QA managers.
According to Aileen Hallahan, managing consultant of IT&T at Hudson IT, Dublin, demand for C# and .Net Developers is high, with skills at times being difficult to locate in Ireland for multiple roles. Most employers are happy to receive applications from Eastern European countries for these skills due to the high level of English spoken and because there is no requirement for visa applications. Siobhan Ryan of Ergo says that there is demand for candidates across the sector, even within the finance industry for those with specialist industry experience. She says that there are opportunities in IT sales and for business analysts and project managers.
Steven Grant of Oriel Recruitment says that there are shortages for well-qualified permanent software testers and test managers as well as for IT network security people with good Cisco qualifications. He adds that risk analysis in financial services is leading to demand for database staff that can work with CRM systems, statistics, quantative analysis, and customer segmentation.
Job candidates at MCSE level and with design experience are in demand, and with more and more IT executives being appointed to boards of directors, there have been strategic changes to IT service delivery solutions. This has created demand for such additional resources as business transformation consultants and change managers. Ian Duncan, director and practice leader at Vision Consulting, says that his company is having difficulty finding commitment-oriented project managers. He states that the number of available candidates is slowing down as candidates are staying put concerned about economic climate. He maintains that good candidates may become increasingly available with more and more large-scale capital investment projects being put on hold.
Most IT Directors continue to seek to keep a portfolio of valuable skills at hand and to protect their teams. Vital to this is understanding and measuring the costs and benefits that staff bring to the business. In such environments, the professional standards and skills required from IT professionals at all levels is rising with an increasing intolerance toward a lack of business understanding or poor project management execution skills. Some IT Directors find themselves in search of employees who can translate technology into business advantage, despite nominal recruitment freezes that may exist. With changes to the work permit and visa process in February 2007, it has become more viable and less administratively difficult to bring in non EU Nationals. Many companies are now finding that it is a useful option.
Regional Trends
Most IT roles are still based in Dublin, with fewer opportunities in such other cities as Limerick, Cork and Galway. Aileen Hallahan of Hudson says that there has been some movement of IT to the Midlands (Athlone) over recent years but that it can be more difficult to attract candidates to this location due to lack of ongoing career development opportunities and fewer choices of companies when deciding to move on. Hallahan says that even within Dublin, difficult public transportation issues discourage candidates from travelling from one side of the city to another, even for the perfect job. Long commutes are not an option for many people who will frequently only seek work in particular areas of the city.
Belfast is emerging as a top centre of IT expertise, with such companies as Fujitsu, Legal Technologies, Citigroup, Liberty Technology, Northbrook Technology NI and Wombat Financial Software setting up in the area. There is demand for people with .Net, J2EE and C++ skills, and experienced candidates can choose from many job offers.
The IT contracting market is well established in the Munster Region. There has been an increase in the number of opportunities and rates available in recent years, and this attracted an increase in the supply of contractors to the region. Demand is strong for development skills, including Java and .Net, business process and project management. The main demand for employees in the region is emanating from small to medium hi-tech companies. The closure of some large multinationals in 2007 resulted in a high number of skilled candidates in the market, and salaries have therefore remained more static than in Leinster.
Upskilling
Most IT Professionals are keen to keep their skills at the cutting edge of technology, and there are always newer releases of software and hardware with which to come to grips. If a company is not moving along with developments in IT, some staff look around for other jobs in order to get exposure to the latest technologies. The skill areas in terms of advancement are mainly with the programming languages C# and .Net technologies and also within the infrastructure environment. Staff members are keen to obtain Cisco certifications and gain network security experience. Steven Grant says given the nature of IT, upskilling is essential for professionals in the sector. He identifies upskilling areas as being CCNA, CCNT, network security, check point certifications, information technology infrastructure library (ITIL), oracle, and Prince.
According to Owen O’Flaherty, financial software engineer at the Dublin office of Sophis Technologies, BScs are common in the Irish workplace, and it therefore makes sense for the modern IT professional to consider further qualifications. He says that candidates will usually have to act on their own initiative in the current economic climate, as companies are cutting back on perks like training courses and MBAs. Research (part-time) Master’s degrees are a popular choice.
Recruitment Techniques
Many IT organisations use such recruitment methods as direct recruitment, referrals, job boards, newspaper advertising, graduate programmes, training and retention strategies, and recruitment consultancies. Recruitment consultancies are competing strongly for talent, and their strategies have become more diverse than ever before. A popular resource is LinkedIn, a business-oriented social networking site that is used to approach candidates who may not be actively looking for a job. Executives are also being searched for in external markets, including London and Eastern Europe. Referral is an excellent way for recruiting candidates, as the company gets candidates that want to work for it and that understand a little more about the company from their friends etc. Ian Duncan of Vision Consulting maintains that referrals are the best source of finding trustworthy, commitment-oriented staff, and he finds it difficult to find the right people through agency sources or LinkedIn.
Salary and Benefits
Salaries have not changed dramatically in recent months, but there has been a clear move toward using perks and benefits in an attempt to retain employees for the longer term. According to Siobhan Ryan of Ergo, salaries in the IT sector have not experienced much movement in recent months, and greater emphasis is being placed on work/life balance. Telecommuting is popular, and employees now enjoy better performance related bonuses and flexible benefits in the areas of healthcare, childcare, and working hours. Typical benefits include performance based bonuses, pensions, health insurance, mortgage subsidy, rent allowance, profit sharing, share options, car parking, car allowance, educational assistance, laptop, mobile phone, taxi service, lunch allowance and subsidised canteen. Onsite dry cleaning, crèches, games rooms, flexible working hours, casual dress and other benefits are rapidly becoming a common feature in employment benefits, particularly within big IT organisations with large headcount numbers.
PricewaterhouseCoopers recently launched its latest Snapshot Survey report covering projected 2008 Irish Salary Increase Trends. The survey, conducted in late 2007, provides information on the base salary increase trends across a variety of sectors and employee categories in Ireland. Key findings from the survey are:
(1) Survey respondents project the total base salary increases across all sectors for 2008 to be 4.89%, down from 5.34% for 2007.
(2) The Telecommunications/Information Technology sector showed the second highest (4.74%) overall projected increase for 2008.
(3) Only a quarter of survey respondents said that their projected 2008 salary increase budget is more than in 2007.
(4) Although survey respondents pitched overall salary increases to be 1.44% ahead of current inflation levels, these projected salary hikes are back to similar levels awarded in 2002.
Outlook
Steven Grant of Oriel Recruitment says that operational type roles will remain buoyant and that the contract market will remain difficult, with many contractors having had to take permanent jobs in the past six months, particularly in the areas of business analysis and project management. Aileen Hallahan of Hudson says that there is still a high demand amongst organisations for the best recruit and that this will continue without doubt going forward. Organisations are prepared to wait for the ideal candidate and will often wait several months with a long interview process in order to ensure this is what they are getting. IT will always be advancing and improving and will play a key role in any organisation’s success and long term plans. Ian Duncan of Vision Consulting says that people in good roles will continue to be nervous of moving jobs but that good candidates may become more available as more large-scale capital investment projects are being put on hold.
In the longer term, the standard of maths among school leavers may be a source of concern. The 2008 Leaving Cert results have highlighted the small amount of high achievers in maths. Over 55,000 students sat the Leaving Cert, but only 6,600 gained Grade C3 or better in higher-level maths. This means that tens of thousands of students will be disqualified from enrolling on third-level courses in courses that are seen to be vital to a knowledge economy. Overall, only 17 percent of Leaving Cert students opted for the higher-level paper in maths. ICT Ireland, the lobby group within IBEC for the Irish technology sector, has expressed concern with the low numbers choosing to sit the higher-level maths paper and has called for the reintroduction of bonus points to encourage more students to select the course.
A study carried out by a consortium composed of Council of European Professional Informatics Societies, the Manchester Institute of Innovation Research, and Eurochambres has found that the EU could run short of people with the right computer skills by as early as 2010, a development that could cause the EU to lose its competitive advantage in IT. To prevent the potential shortage of skilled IT professionals, the research group recommends the benchmarking of EU skill levels against competitor economies; public-private initiatives and investment by IT industry players and the European Commission to estimate future levels of demand; consistent training courses that ensure that IT skills are transferred right throughout business; and concentration on the quality aspects of skill shortages rather that just the quantity.
Ireland remains one of the world’s largest software producers but the future may present some challenges. Issues that could impact the market include a U.S. recession; an increasing use of internet-based services in software localisation that may lessen the need for foreign companies to relocate in Ireland; and the replacement of the supply of software in package format with an internet-based complete service.
Published in HR & Recruitment Ireland, September 2008