For those who, like me, have been pondering whether the traditional notion that IT services firms do well during an economic downturn still holds, here is some evidence that it does. This is from Eric Chabrow at CIO Insight.
Why is employment at IT services firms at record levels when the overall economy is tanking? IT is so integral to business that the need to develop new and support existing systems don't disappear when the economy goes south. But in a weakened economy, businesses don't want to add to their payrolls, so they turn to IT services firms to provide the manpower on an as-needed basis.
And, IT continues to be a catalyst for productivity. Indeed, a brightspot in recent gloomy economic news is IT's role in the recent boost in personal productivity.
As overall nonfarm employers shed 49,000 jobs from their payrolls in May, IT services firms added a miniscule 200 jobs, according to the monthly employment report issued Friday by the federal Bureau of Labor Statistics. That report showed that national unemployment jumped a half a percentage point to 5.5 percent. A year earlier, national jobless stood at 4.5 percent.
IT services firms, tagged computer systems design and related services by the government, employed 1,402,000 people in May. That's 48,600 jobs, or 3.6 percent, higher than a year earlier. [Industry figures for April and May are preliminary.]
Roughly one of five employed IT pros in the United States works for an IT services firm, according to a CIO Insight analysis of government labor statistics.