There are many kinds of shortages. They may be specific to one geographic region, or to a particular set of occupations or subspecialties within a labor market. They may be episodic (e.g., created by a one-time phenomenon of limited duration, such as the Y2K problem or the Euro conversion) or more enduring.
There may be non-statistical indicators of a labor shortage as well. If a large number of people say there is a labor shortage problem and act as though there is, then there may well be a problem. This is especially true if the action comes from companies ranging across multiple geographic regions and industry sectors, and if these companies begin to devote significant resources to correcting the problem by increasing recruiting, initiating studies, supplementing training, or even lobbying. A further indication of a shortage is when labor suppliers and professional societies representing the workers, not only the trade associations representing the companies, become concerned.
Is There a Shortage of IT Workers?
For some readers, this is the most important question addressed in this study. It is difficult to give a straightforward answer because of the imprecise definitions of supply and demand, the complexity of the IT workforce (many different kinds of jobs involving widely varying skill and knowledge sets, and distributed across many different sectors of the economy), and the lack of good data. There might be a shortage in one IT occupation (such as LAN administrators), but not in another (such as data entry clerks); or in one geographical region (such as Silicon Valley) and not in another (such as a purely agricultural area). The situation also changes rapidly over time. What is true at the time this report is written may not be true six months later.
In trying to answer this question about a shortage, it would probably be more insightful to do some labor market segmentation, rather than viewing the IT labor pool as one undifferentiated mass. There are barriers to geographical relocation of workers, which might make geographical segmentation useful. These include the cost of relocation, the cost of living in some of the areas where IT jobs are abundant (e.g., Silicon Valley), the social upheaval to the worker and the worker's family, and the difficulty of locating and securing a job outside the region where the worker is currently living. Distance may be a particular barrier in filling lower-skill, lower-pay jobs. Thus geographical segmentation of the IT workforce may be important to the understanding of shortages.
Because the skills and knowledge required vary so much from one IT job to the next, occupational segmentation may be even more useful than geographical segmentation. It would be a good test of the analytical value of this report's categorization scheme to segment the labor pool into conceptualizers, developers, modifiers/extenders, and supporters/tenders to segment the workforce when looking for labor shortages (see table 2-2). It is clear, however, that such a segmentation would not provide a complete breakdown. For example, computer security and networking are hot areas today, and there may well be shortages, or at least very tight labor markets, associated with these specialty areas. However, they cut across our four categories. The demand is uneven across even a single occupation, such as programmer. There is no known demand for APL programmers today; COBOL programmers are in short-term demand for fixing Y2K problems; and Java programmers appear to be in demand for the foreseeable future because of all the network applications being written in Java. Unfortunately, the data are inadequate to support a segmented analysis by either geography or occupational categories; thus this discussion of the shortage issue will consider the entire IT workforce.
At the outset of this study, it was clear that some trade associations believed there was a shortage of IT workers, while some labor unions disputed the claim. The H-1B debates showed that the worldviews and interests of these two kinds of organizations made it difficult to find common ground on which to evaluate the question of a worker shortage. The study group was somewhat surprised and dismayed to find a similar gulf between IT professionals and social scientists interested in this issue. The IT professionals have what they believe to be overwhelming local evidence of a shortage—personal experience of multiple unfilled jobs, multiple job offers for their graduating students, high salaries for graduates in hot technology areas, and more. The social scientists, trained to discount this kind of anecdotal evidence, demand strong statistical proof. As part of their scientific training, they tend to be skeptical about virtually all of the existing statistical data, which is in one way or another imperfect; and they tend to dwell on the methodological shortcomings of the data rather than using them as predictors—albeit imperfect ones—of a shortage or lack thereof.
Where (most) IT professionals see a shortage, (most) social scientists see a tight labor market. Is this just a semantic difference? This is unlikely. The distinction reflects an attitude about the nature of the problem and the need for a policy response. If there is simply a tightness in the labor market, there is a belief that the costs are bearable to the market participants, the market will eventually self-correct (or market participants will learn to live with the situation), and no government intervention is necessary. If there is a shortage, however, the costs to the market participants may be unbearably high, the ability of the market to self-correct is questioned, and government action may be warranted.
Unfortunately, no one kind of evidence currently available provides a clear and unambiguous answer as to whether there is a shortage—or even a tightness—in the IT labor market. Thus the strategy in this section is to look at six different kinds of evidence, each with its own strengths and weaknesses:
1) a direct counting of supply and demand; 2) secondary statistical indicators based on presumably solid federal data; 3) data from limited-scope studies that seem to be methodologically sound; 4) data from more general studies whose methodologies have been questioned; 5) anecdotal evidence of employer actions; and 6) other qualitative evidence. The limitations of each kind of evidence are discussed, as well as what it indicates about the existence of a shortage/tightness.
1. Direct counting. In order to demonstrate that there is a shortage of IT workers—that is, an excess of demand over supply—one would need a clear working definition of an information technology worker, as well as good statistical data about supply and demand. The problems of finding a good working definition of an IT worker have already been discussed. The supply system is complicated, as chapters 5 and 6 show; and anything close to adequate statistical data about the current potential supply, much less future supply, are nonexistent. Data about demand are even more elusive—they are out of date, the sample sizes are too small, and they rely on vague and inconsistent definitions of what kinds of demand to count as related to IT workers. Thus it is impossible at this time to provide meaningful quantitative information about a national shortage of IT workers. In particular, there is no adequate basis for quantifying the size of the shortage (if there is one). Collecting better data will be a major challenge, and the study group is not optimistic that reliable quantitative measures are likely to be available anytime soon.
2. Statistical indicators based on federal data. Even if the supply-demand match cannot be measured directly, it is useful to look at four secondary data indicators based on federal data. These data are likely to be as reliable as any data available on this issue because of the size and scope of federal data sets, the objectivity with which the government collects the data, and the methodological rigor with which they are analyzed. These secondary data indicators provide only inferential, not direct, evidence of a shortage; and for each indicator, there are some reasonable questions that might be raised about the validity of the inference. In general, these secondary indicators are also unable to distinguish between a shortage and a mere tightness in the labor market. While none of the indicators provide conclusive evidence, taken together they offer a preponderance of circumstantial evidence in support of tightness/shortage in the IT workforce.
- Unemployment rates. As table 4-1 shows, the unemployment rates for each of the three categories of IT workers under the Bureau of Labor Statistics (BLS) classification system were all 1.6 percent or lower in 1997. The IT unemployment rates are about three times as low as overall unemployment rates in the United States—suggesting a shortage/tightness. However, to properly interpret these numbers they should be seen in comparison with some other statistics. First, the IT unemployment rates have been consistently low, in both absolute terms and in relationship to national unemployment rates, since 1988; however, the claims for an IT worker shortage have only been made in the past several years. Why were they not made in the late 1980s or early or mid-1990s? Second, it may be unfair to compare IT unemployment rates with national unemployment rates, in that professional unemployment rates are almost always significantly lower. The overall unemployment rate for all specialty professions is only slightly above two percent—not that much different from the IT worker unemployment rates. But it is hardly credible that there is a shortage of all professional workers. Thus, while unemployment rates may suggest a shortage/tightness in the IT labor market, as an indicator they are not entirely unproblematic.
- Permanent labor certificates. Certificates offered by the Department of Labor represent another indicator of demand unmet by domestic workers. Aliens who want to become permanent residents must have an offer of permanent, full-time work from an employer in the United States. The employer must obtain a labor certificate from the Department of Labor, indicating that qualified U.S. workers are not available for the position, and that the wages and working conditions are consistent with prevailing conditions for similar employment in the United States. In 1996, about 40,000 new applications were received and a slightly larger number were approved. About eleven percent of the approved applications were for IT-related occupations. Three IT occupations were among the five occupations receiving the largest number of permanent labor certificates in 1996: software engineers (ranked second, behind specialty foreign cooks, with 2,238 approvals (5.5% of the total)), programmer analysts (ranked third with 1,231 approvals (3.0 %), and systems analysts (ranked fifth (after college and university faculty, with 616 approvals (1.5%)). Other IT occupations ranked in the top 100 were: computer programmers (124 approvals), database design analysts (104 approvals), computer systems hardware analysts (74 approvals), database administrators (69 approvals), systems programmers (56 approvals), and programmers—engineering and scientific (45 approvals).
There are several arguments against using these permanent labor certificates as a strong indicator of IT labor shortage/tightness. While the IT occupations rank high in the list of occupations for which permanent labor certificates are requested, the absolute numbers are small. Some even question how meaningful these statistics are. Anecdotal evidence from computer industry executives suggest that many of these certificates are applied for (and more than 90 percent are approved) not to fill an unfilled job, but at the request of a current employee who is working on a temporary visa (H-1B or one of the predecessor programs) who wants to work permanently in the United States. The Department of Labor's Inspector General has reported that the certification program is subject to extensive manipulation by employers and immigration lawyers.34
- Temporary labor certificates. Department of Labor certificates are also available for employers who wish to hire professional workers under the H-1B visa program. Employers must certify that they will pay the prevailing wage and that there is no strike or lockout underway. There is no limit on the number of job openings that can be filed for certification, and the Department of Labor approves almost all of them. However, there is a limit on the number of H-1B visas that can actually be awarded in a given year. In 1996, 41.6 percent (102,422 out of 246,725) of the applications were for IT-related jobs. In fact, the most frequent occupations for which H-1B labor certificates were received (84,370 jobs, representing about one-third of all jobs certified), were in Systems Applications and Programming. The large number of these H-1B labor certifications suggests a shortage/tightness in the domestic labor market. Although many of these certificates are apparently awarded to foreign-owned companies operating in the United States that hire primarily foreign workers (e.g., Tata Consulting, Syntel, or Mastech), these companies are still undertaking IT work for U.S. industry, helping to satisfy the overall demand. Hence, even though special kinds of companies may dominate the requests for these certificates does not mean that this information should not be factored in.
- Wage growth. Table 4-2 shows that salaries in the IT-related occupations have gone up at about the same rate as, or only slightly faster than, salaries in other professional occupations—or than salaries overall. This fact suggests there is no shortage, contrary to all of the other statistical indicators based on federal data described above. One possible explanation is that BLS data on wages are inconsistent with private sources of data, such as employer salary surveys. The private data sources virtually all give annual wage growth figures that are higher than federal data—including one source that shows an annual wage growth of 18 percent in some IT occupations.35 The trade association Information Technology Association of America (ITAA) claims the reason for this is that "BLS numbers do not include stock options, signing bonuses, and referral bonuses, which are major parts of compensation packages in the IT industry."36 However, the case of the systems administrators suggests another possible explanation for slow wage growth. Whenever there is a rapid growth in an occupation, the average level of experience is likely to fall. In some IT occupations—such as systems administrators—there are a large number of workers at the entry level, apparently meeting a need at that level; however, there may be a serious shortage of workers with the same job title but having advanced skills.37 While the average salary for systems administrators did not rise much in the period 1989 to 1993, salaries for high-end systems administrators (at least in the San Francisco Bay area) doubled.38 In such cases, it might be more revealing to track top-quartile salaries or conduct a longitudinal study of salaries of a particular group of workers, rather than rely on average occupational salary. It is not clear how representative this example of systems administrators may be of IT work as a whole.
- Worker projections. Table 4-3 shows IT occupations that appeared in the table of Occupations with the Largest Job Growth, 1996-2006, produced by BLS. The joint category of "database administrators, computer support specialists, and all other computer scientists" appeared at the top of the list, with an expected growth rate of 118 percent. Computer engineers and systems analysts came second and third on the list. Also appearing on the list were desktop publishing specialists (ranked 8th), data processing equipment repairers (ranked 15th), and engineering, science, and computer system managers (ranked 23rd). These numbers are not collected data as are the other federal data we have considered in this section, but are only forecasts. Thus they concern the future, not the current situation. Why should they be considered as any kind of an indicator of the current situation? The reason is that the projections are based in part on the current situation, as well as on anticipated future changes that will affect supply and demand. It is unlikely that the projections for future years, especially in the near future, would have shown such a large predicted growth if there were not a current robust demand. It should also be remembered, however, that these kinds of projections are notoriously difficult to make and that BLS projections have sometimes been way off the mark.39 For all of these reasons, these worker projections are probably the least reliable of all the federal data indicators of a shortage or tightness.
3. Limited-scope studies. Two studies are considered here. Both focus on software workers, which is the area of IT work with the greatest occupational growth. One study is national, the other regional. The national study was produced by the National Software Alliance, a consortium of industry, government, and academic leaders that was formed specifically to address their concerns that there is an IT worker shortage.40 The study gives many different kinds of evidence, some based on federal data, many based on private data. We did not evaluate the methodologies used in the collection and analysis of these private data sources, but presumably there is a range of quality and reliability across these sources. What is perhaps most remarkable about the National Software Alliance's study, however, is the large number of different statistical analyses, from various sources, that support one another in showing the existence of a shortage, or at least a tight labor market, for software workers. Here are a few examples from the report based on private data:
- The Olsten Corp., a large staffing services company, conducts an annual staffing survey of a range of North American businesses. The 1997 survey indicated that the high-tech sector had a much higher percentage (59%) of companies reporting that they did not have enough employees to meet their operational needs than any other for-profit sector.41
- Microsoft Corp. had more than twice as many job openings in its Microsoft Certified Solution Provider program in the United States than there were software workers in all of Ireland—the country that exports the world's second largest amount of software after the United States (and, hence, presumably one of the leading potential sources of IT workers for the United States).42
- The National Software Alliance analyzed twenty-one private salary surveys, all of which showed that IT worker salaries were rising faster than inflation. A study by the Deloitte and Touche Consulting Group indicated an increase of 7.45 percent from 1996 to 1997 for computer networking professionals. Computerworld's 1997 salary survey revealed average annual salary increases of more than 10 percent in 42 percent of the twenty-six occupations tracked.43
- Starting salaries for computer engineers with a new bachelor's degree increased by 5.8 percent to $39,722 from 1996 to 1997.44 (This increase is well above the national inflation rate, but lower than increases in a few other professional occupations.)
- The insurance, automotive, computer software and hardware, telecommunications, and pharmaceutical industries all have annual turnover rates of between 15 percent and 19 percent for software workers.45
The second study, conducted by the Washington Software Alliance, looks at software workers in the State of Washington.46 As the Alliance itself notes, the situation in Washington is not entirely representative of the nation as a whole. The average software wage in the state is reported to be $66,752, the highest of any state in the nation. They also note that growth in the software industry in the state is outpacing the national average, with a growth from 1990 to 1996 of 17.8 percent compared with a national growth of 9.8 percent. The state has two major employers, Microsoft and Boeing, that may make its situation somewhat different from the nation as a whole. Given these caveats, it is useful to consider the report's statistics, which suggest a serious worker shortage.
The Alliance's survey includes all positions in the Washington State software industry, technical and non-technical. The industry includes 2,500 companies, with $20 billion in annual revenue and 47,000 employees. There are 7,300 current vacancies (15.5% of all positions), with 64,000 total desired hires in the next three to four years. A $12.8 billion three-year revenue gain is projected if these positions can be filled. Three-quarters of all jobs require a bachelor's degree or higher. The greatest need (largest number, hardest to hire, driving force for the industry) is for junior and senior developers—positions that require a BS or MS in computer science or computer engineering. There are eight jobs for every relevant in-state bachelor's graduate, and four jobs for every relevant in-state associate's (two-year) degree graduate. Unlike the views of a number of other industry representatives, the Washington State software employers are very satisfied with the technical, social, and English-language skills of those they hire. Their problem, they claim, is a numbers gap, not an educational quality gap.
In addition to considering how representative the Washington State situation is of the national scene, determining what the statistics actually mean also needs to be addressed. It is difficult to project accurately the number of new positions that will exist or be needed in the future, or the dollar value added by additional filled positions. While Microsoft and Boeing may hire many of their workers from in-state schools, they both recruit nationally, making it somewhat misleading to calculate state-graduate-to-open-job ratios. The problems of using vacancies as an indicator were described earlier.
4. Methodologically challenged national studies. The first ITAA report initiated the national debate over the IT worker shortage. This section will consider it and its follow-up report.47 Criticisms concerning the ITAA's methodology and results were discussed earlier, but are briefly reviewed here.
The main criticism was the direct count of supply and demand that ITAA tried to make. The first study used undergraduate graduation rates in computer science to measure supply, when this is only one of many supply sources of IT workers. The report also did not present available data that indicated the number of undergraduate majors in computer science was increasing after a long decline. On the demand side, a very broad definition of an IT worker was used, and the telephone survey used to collect the data had a very low response rate. Because of the low response rates, the results are statistically questionable. For example, companies that needed IT workers may have been more willing to respond to the survey than companies that did not. For these reasons, there are real questions about the reliability of the predictions in the two ITAA reports, respectively, that there are 190,000 and 346,000 unfilled IT positions in the United States. But even if the results do not have the weight of scientific evidence, they suggest that a number of companies are having difficulty filling positions.
Other kinds of evidence are also cited in the first ITAA study to support a worker shortage. Here are some samples:
- 82 percent of the companies that responded to the ITAA survey indicated that they planned to increase the number of IT workers they employed in the coming year, while only 2 percent indicated they planned to decrease the number.
- 83 percent of the companies indicated that they thought the demand for IT workers was higher than the demand for other kinds of workers.
- William M. Mercer, which conducts a compensation study for ITAA, noted an increase in average hourly compensation of nearly 20 percent from 1995 to 1996 for operating system software architects and consultants, about five times the national average.
The second ITAA report, in addition to its information about vacancies, provides a combination of anecdotal information and statistical data from other sources. All of this additional evidence they cited suggested a shortage/tightness. (However, it should be remembered that ITAA is an advocacy group and that they presumably chose only examples that supported their position.) Here are some of the examples ITAA cites:
- The high IT vacancy rates of two companies are noted: 14 percent at Booz-Allen & Hamilton Inc., and 16 percent at Mary Kay Inc.
- A quarter of the IT managers reported that employees who departed voluntarily in the previous year was in excess of 10 percent of their organization's total programming staff, according to an InformationWeek survey.48
- Some companies were paying employees up to $15,000 for referrals that led to critical IT hires; company stock options were reported as being routinely offered; benefits and amenities such as gyms and exercise facilities, day care, restaurants, medical assistance, flexible work schedules, and increased vacation time were increasingly common.49 (But the report did not reveal how often these perks and benefits were offered.)
5. Anecdotal evidence about employer actions. Table 4-4 provides a list taken from the Barnow, Trutko, and Lerman paper on what a company might do in reaction to a labor shortage. There is anecdotal evidence that every one of these strategies has been adopted in connection with IT workers.
- Recruiting. There are many signs of increased recruiting. More ads are being placed in both the traditional print sources and on the Internet; and display ads, which attract more attention and are more expensive, are on the rise. Recruiting on campus appears to be way up. Georgia Tech, for example, has seen the number of employers attending their IT career days double each year for three years, until meeting space capacity was reached. Job fairs are being held with increasing frequency, if ads in the local and national newspapers are any indication. Booklets listing available IT jobs have started to be distributed free of charge in video stores and other retail establishments throughout Northern Virginia, next to the Apartments to Rent booklets. It is apparently becoming more common for companies to pay significant recruitment bonuses to current employees who can recruit new workers. Companies are also increasingly targeting specific schools in their recruitment efforts, and are sending their corporate executives and highest profile researchers to these campuses to raise the company's visibility with the students.
- Overtime. There have been some reports of extra overtime for IT workers. IT faculty and IT managers in industry are typically exempt employees who work long hours without extra compensation. IT workers in computer startup firms may also work long hours without extra compensation because there is the expectation of total dedication in return for a cut of the action. But overtime is generally paid to IT workers by most companies outside the IT sector, and by many of the larger and more established computer and software manufacturers. Because of the prevalence of long hours, employers have implemented a number of standard practices, such as feeding employees who work late or taking the development team on expensive vacations after a project has been successfully completed. However, hours can only be increased so much and for so long before the strategy becomes counterproductive, leading to poor morale and shoddy workmanship, for example.
- Reducing minimum qualifications. There is a long history of companies hiring people for IT jobs who possess fewer or different skills from those outlined in the job description. Perhaps this is because the unemployment rate for IT workers has been so low for such a long time. There is some evidence that today companies are recruiting in more places, and hiring students graduating from schools that are less prestigious than they would have considered in the past. As discussed elsewhere, hiring underskilled employees can be a dangerous practice because productivity and quality levels vary highly from worker to worker in many IT occupations, especially ones involving programming.
- Restructuring work. IT work is being restructured so that human substitution can occur. Clerical staff are being trained to work as local area network or database administrators, Web designers, and software installation experts. Companies are trading off a greater amount of general and foundational education (such as would be gained from a bachelor's degree and some course work in computing) for training in a specific, current technology (high school graduates with a six-month certificate program to become a Novell or Microsoft technician). In some cases, companies contract out the technical aspects of the work and retain only a small IT staff of one or two leaders and some maintainers.
- Substitution of machinery for labor. There have been many efforts to substitute machinery for labor, but the long-term effect is unknown. Companies relying on software applications are rapidly introducing automated software maintenance programs that replace workers, but, in many programming environments, technology is expected to reduce labor by no more than ten percent.
- Training. Companies seem to be more willing to retrain current employees than to train new workers. In a highly competitive marketplace with narrow windows of opportunity to introduce a new product, such as an Internet-based product, it is not surprising that companies would be reluctant to hire workers who needed six months before they could be fully productive. However, some companies, such as Andersen Consulting and PeopleSoft, have a successful practice of hiring bright college graduates, independent of their undergraduate major, and giving them intensive technical training when they join the company. It is unlikely, however, that this practice would work for all companies.
- Working conditions. Companies in the IT industry have a long-standing record of providing whatever is needed in the way of benefits, improved offices, child care, flexible working hours, and other non-wage perquisites to attract and retain workers. It is somewhat harder for companies in some other industrial sectors to give preferential treatment of this kind to their IT workers and not to their other workers.
- Bonuses. Sign-on bonuses are becoming increasingly common for IT workers.
- Wages and Benefits. This issue was discussed earlier. Anecdotal evidence suggests that IT workers are sensitive to market salaries and benefits and are willing to switch jobs on this account. Organizations that have restrictions on their ability to meet market conditions, such as some colleges and government organizations, often have trouble attracting or retaining IT workers.
- Contracting. The amount of IT work that is contracted out is already substantial and is growing. The rapid growth of IT consulting firms is evidence of this trend.
- Refusing work. It is common for IT departments to tell their internal customers that they cannot meet their requests. It is difficult to determine how much external work is refused.
6. Qualitative evidence. There is also an abundance of non-statistical evidence. This does not have the same persuasive force as methodologically sound quantitative data because it is hard to distinguish the special case from the general rule, but qualitative evidence can be both revealing and suggestive—especially if there is a lot of it, of various kinds, and from various sources. The preponderance of this anecdotal information supports either a shortage or a tightness in the IT labor market, although none of the evidence available can distinguish between the two. The third bullet below presents one of the few examples that speak against there being either a shortage or a tightness.50 Here are a few examples:
- Every company our study group heard about, both in the IT sector and in other sectors, claimed it was experiencing difficulty with IT recruitment (either worse-than-expected results in hiring, or having to work much harder than in the past to achieve hiring quotas).
- The study group came across various professional societies, state government agencies, regional economic trade associations, private foundations, individual colleges and universities, university systems, and chambers of commerce that were concerned about and studying the IT labor shortage issue, or that had developed programs to develop IT workers.51 Most of these organizations would not have devoted the time or effort unless they were convinced there was a problem.
- A small body of non-statistical evidence speaks against a worker shortage (or even tightness in the market). This includes anecdotal evidence from older technical workers unable to obtain IT jobs, for example in the electrical engineering field. One would assume that experienced electrical engineers would have some computer skills, mathematics, science and engineering background, problem-solving and communications skills, and a knowledge of industry that would make them desirable to companies needing IT workers; but electrical engineers indicate some trouble being hired for these IT jobs.
Conclusions:
- There is no way to directly answer the question of whether there is a shortage of IT workers because there are no adequate definitions or adequate data to directly count either supply or demand.
- Other sources of information are inferential and less reliable than the direct counting approach. Indeed, there are credible reasons for doubting virtually any piece of evidence that is currently available.
- The inferential evidence does not easily allow one to distinguish between a shortage and a tightness in the IT labor market. (The indicators would look about the same whether there was a shortage or simply tightness.)
- The statistical indicators based on federal data, the regional and occupation-specific data studies, the methodologically challenged advocacy studies, and the qualitative evidence almost all suggest either a tightness or a shortage.
- It is likely that there are spot shortages, both in specific geographic regions and in specific occupations. In a field experiencing rapid growth and rapid technological change, it would be surprising if there were not such shortages.
- Discussion of supply and demand of IT workers would be more insightful and useful if the market could be segmented by geography and/or occupation, but data do not exist to carry out this analysis.
Where Are IT Shortages Occurring?
There is only anecdotal evidence to answer this question. The federal data categories are too coarse and the data too old to be of much help. The software area appears to be experiencing significant shortages at this time, especially for applications relating to networking, databases, and Internet-based applications. These shortages tend to be concentrated in niches and in jobs requiring higher skill sets. The problem is worsened by the fact that software workers are not always qualified to move from one software job to another. A programmer experienced in one programming language may not be effective in another. It is not simply a matter of learning the grammar and vocabulary of the language. More critical is learning the underlying methodology used with that programming language to attack programming projects, and this methodology varies considerably across programming languages. For example, programming in COBOL is very different from programming in Java; and it has been hard to retrain COBOL programmers (who received their experience on mainframe computers and are briefly in demand today because of the Y2K problem) to be Java programmers (who are likely to be in great demand well into the new millennium to program applications for use on the Internet).
Based on anecdotal evidence only, the following points represent the study group's consensus about occupations where either demand outstrips supply or many positions are filled with underskilled workers:
- programmers, but especially those who are familiar with Oracle, SAP, BAAN, and ERP;
- programmers and designers with object-oriented and Java experience;
- Web and e-commerce specialists;
- Network designers;
- Problem-solvers with enough IT background to be able to work as consultants for the major accounting and consulting firms (Ernst & Young, Andersen Consulting, PriceWaterhouseCoopers,
EDS);
- Faculty, especially in high schools and some two- and four-year colleges;52 and
- Managers and project leaders.
Footnotes
32 For a description and analysis of various definitions of 'labor shortage' given by economists over the past forty years, see Burt S. Barnow, John Trutko, and Robert Lerman, "Skill Mismatches and Worker Shortages: The Problem and Appropriate Responses," Draft Final Report, The Urban Institute, February 25, 1998, pp. 4-14. One definition in particular that we do not adopt is the so-called Social Demand Model of labor shortage. Under this definition, a shortage exists if there is not a sufficient number of workers of the type in question to meet a particular social goal. Thus some people might argue that there is a shortage of public school teachers because children seem to get a better education in smaller classes; or others might argue that there is a surplus of lawyers because our society would be better off if it were less litigious. The Social Demand Concept of a shortage depends on personal judgments about social welfare. The definition we adopt focuses on market equilibrium-the match between supply and demand as measured by economic indicators.
33 See Barnow, Trutko, Lerman, ibid., p. 55, for a discussion of this issue. Also see Timothy Bresnahan, "Information Technology, Workplace Organization and the Demand for Skilled Labor: Firm-level Evidence," Department of Economics, Stanford University (http://timb.stanford.edu/research/itwold8-21f.pdf)
34 See http://www.oig.dol.gov/public/reports/oa/1996/foreign-labor-cert.pdf.
35 However, some of the recent non-federal data show a flattening of salary increases. See the 12th annual salary survey by Computerworld and the related article by Leslie Goff, "Enough is Enough: The Joyride Is Over, As Corporate Managers Put the Brakes on Out-of-Control Salaries for IT Professionals," Computerworld, September 7, 1998
(http://www.computerworld.com/home/features.nsf/all/980907mgt)
36 Lauren Brownstein, "Is There a Shortage of Information Technology Workers?" Symposium Proceedings, The Jerome Levy Economics Institute of Bard College, June 12, 1998, p. 5.
37 This example is not one discussed in the ITAA report. For an interesting overview of the occupation of systems administrator, including a description of the job and formal educational, commercial training, and independent study programs preparing a worker for this occupation, see David Kuncicky and Bruce Alan Wynn, "Educating and Training System Administrators: A Survey," published by the USENIX Association for SAGE, the System Administrators Guild, Berkeley, CA, 1998.
38 According to Stephen Johnson, the USENIX representative on the study group. USENIX pays close attention to the work of systems administrators.
39 For example, in 1984 BLS projected 520,000 computer science and systems analysts jobs in 1995, but there were actually 860,000. BLS predicted a 53-percent growth in electrical engineering jobs over this period, whereas there was actually a 9-percent decline. (See John H. Bishop's commentary in the Levy Symposium Proceedings, p. 8.)
40 National Software Alliance, "Software Workers for the New Millennium: Global Competitiveness Hangs in the Balance," Arlington, VA, 1998. This Alliance has a Department of Defense orientation. It has been argued that salaries and benefit packages offered to IT workers in the defense industry are relatively poor compared with those offered to IT workers in other sectors; and that this disparity creates a difficult recruiting and retention situation that is reflected in the National Software Alliance's view that an IT worker shortage exists, and the need to act on it for national security reasons (Michael Teitelbaum, Sloan Foundation, personal communication, March 1999). Whether one needs to question the reliability of the National Software Alliance's data, even if they are an interested party, is unclear.
41 "1997 Olsten Forum on Human Resource Issues and Trends: Staffing Strategies," William Olsten Center for Workforce Strategies, Melville, NJ, 1997.
42 "Ireland: The Software Capital of Europe," National Software Directorate, Forbairt, 1997; Christina Torode, "Closing the IT Skills Gap," Computer Reseller News, December 1, 1997, Issue 766.
43 See National Software Alliance, op. cit., page 2-21 for citations to the original studies.
44 Based on data from the National Association of Colleges and Employers, "Salary Survey," July 1997.
45 Based on 11th Annual Salary Survey, Computerworld, September 1, 1997.
46 See http://www.wsa1.org/gotwork/wasoft.htm
47 "Help Wanted: The IT Workforce Gap at the Dawn of a New Century," Information Technology Association of America, Arlington, VA, 1997; "Help Wanted 1998: A Call for Collaborative Action for the New Millennium," Information Technology Association of America and Virginia Polytechnic Institute and State University, March 1998.
48 E. Cone, "Staffing: Short Supply," InformationWeek, November 1997 (http://www.techweb.cmp.com/iw)
49 "Good Help Is Hard to Find," Computerworld, October 1997, and "Good Help Is Hard to Find," Computerworld, November 1997-both at http://www.computerworld.com; "Tech Corporate Culture Cozy, Creative," USA Today, November 1997 (http://www.usatoday.com); E. Cone, "Staffing: Short Supply," InformationWeek, November 1997 (http://www.techweb.cmp.com/iw).
50 For some examples of articles questioning the existence of a shortage, see Margie Wylie, "The Skills Shortage That Isn't," CNET news.com, February 4, 1998 (http://www.news.com); also Dominique S. Black, "Taking Shots at the Labor Shortage," IT Careers, March 23, 1998.
51 For example, the Society for Information Management (SIM), a professional association of 2,700 managers of information technology and its applications to business, has drafted a position paper on the worker shortage. "SIM believes this labor shortage is the most severe in the 50-year history of computing, and will continue well into the next millennium...[in part because of] a fundamental shift in investment economics favoring increased use of IT." ("Addressing the Information Technology Workforce Shortage," Position Statement, Society for Information Management, October 1998, Chicago, IL.) A Web site maintained by the Department of Commerce profiles 170 IT worker-development programs throughout the country. See http://www.ta.doc.gov/go4it/
52 A small survey on faculty hiring carried out by the ACM Special Interest Group on Computer Science Education, to which 64 institutions responded, suggests that faculty recruitment is more difficult in non-research institutions. When asked how difficult or easy faculty recruitment is, the survey received the following responses: at schools that grant the Ph.D. in computer science: easy 12.5%, moderate 31.3%, difficult 56.2%; at schools that grant the master's degree as their highest degree in computer science: easy 4.7%, moderate 28.6%, difficult 66.7%; for schools that grant the bachelor's degree in computer science as the highest degree; easy 3.7%, moderate 3.7%, difficult 92.6%. Preliminary results, July 27, 1998. For more information, contact Professor Paul Myers, Department of Computer Science, Trinity University, San Antonio, TX.
Copyright © 2004 Computing Research
Association. All Rights
Reserved. Questions? E-mail: webmaster@cra.org.
Document last modified on Wednesday, 04-Apr-2012 06:51:20 PDT.
