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Tech Jobs Disappearing As IT Job Growth Was Weak In 2012

Tech Jobs Disappearing As IT Job Growth Was Weak In 2012

COMMENTARY | As the American economy putters on we find tech jobs disappearing. While the American recession plays a large part, you have to keep in mind that the American GDP has been steadily increasing in the past few years. So why are tech jobs disappearing?

InfoWorld reports that “IT job market growth slowed to 4,200 new jobs in December versus 8,700 added jobs in November. For the entire year, IT gained 62,500 jobs, a 2.22 percent increase from around 2,813,000 to 2,876,000.” They point out that if you analyze the data and remove seemingly non-tech jobs, like those from the telecom industry, then the picture is slightly more rosy but overall it could still be said that many tech jobs are disappearing.

Tech jobs have a gloomy outcast if you go by the layoff numbers. If 2012 added 62,500 tech jobs overall this was still amidst a cloud caused by downsizing according to Xfinity:

“Hewlett-Packard Co. (NYSE: HPQ), which is so badly off that investors now question its viability, fired 27,000 people in May. That number could rise rapidly as some of its core tech divisions struggle for sales. The botched buyout of Autonomy almost certainly will cause more job cuts in that division, which has, according to HP, much lower profits than forecast. CEO Meg Whitman has said HP sales may not improve for two years or more.”

Economics experts are cautiously optimistic about the future but there are several practical reasons for why tech jobs are disappearing. The most obvious is that computer parts and also whole devices are quickly becoming disposable appliances.

For example, a low-end PC can be purchased for around $300. Other than data recovery, why would you pay a computer technician to repair it? Even then, employers actually benefit from paying less than you would expect because this would only attract inexperienced employees. In this case inexperience is a boon since repair companies often charge by the hour. An IT professional making $20 an hour might solve a problem quickly, but that hardly benefits the bottom line.

The disposable issue applies to many smartphones and tablets. While it’s reasonable to repair the latest iPhone 5 or a high-end tablet due to their high contract free retail price, for the most part these devices are disposable. The SD memory cards and all your important data are typically independent of the Android or iOS operating systems and thus it’s easier to replace these devices. As an example, my wife’s smart phone is currently on sale for $49 and there’s no reason to attempt repairing it if it were to malfunction even though I know how to do so.

Another good reason why we see tech jobs disappearing is the rise of the independent contractor. Why would a company want to have a fully staffed IT department with expensive salaries when they can simply hire a contractor when they need one to make up the slack?

Much of the heavy lifting in the tech arena is being shifted to the cloud. Because of automation software and improvements in server operating systems it’s now much easier to manage a large server farm, perhaps even remotely. As the efficiency increases the need for more tech jobs disappears.

This of course leads into the discussion of globalization. While some jobs have begun to make their way back to America because of localization, in many cases it’s still far cheaper to employ workers living in areas of the world where the cost of living is comparatively far less than the United States.

Overall, could be said that tech jobs are not disappearing but they are certainly slowing in growth. Do you think there are other reasons for why we see tech jobs disappearing?

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