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Mid-Year Reality Check: More IT Leaders Expect Budget Increases; Hiring Hits Summertime Lull

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About TEKsystems

People are at the heart of every successful business initiative. At TEKsystems, we understand people. Every year we deploy more than 80,000 IT professionals at 6,000 client sites across North America, Europe and Asia. Our deep insights into IT human capital management enable us to help our clients achieve their business goals–while optimizing their IT workforce strategies. We provide IT staffing solutions, IT talent management expertise and IT services to help our clients plan, build and run their critical business initiatives. Through our range of quality-focused delivery models, we meet our clients where they are, and take them where they want to go, the way they want to get there.

Hanover, Md. – July 28, 2015 – TEKsystems®, a leading provider of IT staffing solutions, IT talent management expertise and IT services, today released the results of its quarterly IT “Reality Check,” a survey that compares current market conditions on the state of spending, skill needs and impact areas originally reported in the company’s Annual IT Forecast released in December 2014. The most recent survey represents the views of more than 240 IT leaders (CIOs, IT VPs, IT directors, IT hiring managers) as of June 2015.

Key highlights from the survey include:

Budget Increases Rise Past Levels Originally Anticipated; Hit High for 2015

  • Heading into 2015, 45 percent of IT leaders expected their IT budgets to increase. Through the first half of the year, the percentage of IT leaders who expect increases for the coming quarter is now at its highest level. At the end of March, 43 percent expected increases, while 50 percent expect increases as of the end of June.
  • Thirty-nine percent of IT leaders expected their IT budgets to stay the same as they entered 2015, but fewer say this is the case heading into the second half of the year. At the end of March, 43 percent indicated budgets would stay the same, while 35 percent report this as of the end of June.
  • At the beginning of 2015, 16 percent of IT leaders expected their IT budgets to decrease. This viewpoint remained relatively consistent through the first half of the year, with 14 percent and 15 percent of IT leaders reporting the same for the end of March and June, respectively.
  • Findings: The number of IT leaders who expect budget increases in the last quarter has grown past the number that originally anticipated increases and is now at a yearly high. Compared to the original forecast, an additional 5 percent expect increases, shifting away from expectations for budgets to stay the same (4 percent decrease) or decrease (1 percent decrease). Furthermore, the number of IT leaders who expected budgets to either increase or stay the same has been remarkably consistent at 84 percent heading into 2015, 86 percent at the end of March and 85 percent at the end of June.

Confidence at Year’s Highest Levels

  • Heading into 2015, 71 percent of IT leaders were confident in their IT department’s ability to satisfy business demands. Heading into the second half of the year, slightly more express confidence. At the end of March, 70 percent were confident, while at the end of June, 74 percent expressed confidence.
  • Twenty percent of IT leaders expressed a neutral view in their IT department’s ability to satisfy business demands as they entered 2015. At the midpoint of 2015, this percentage decreased. At the end of March, 18 percent had a neutral stance and 13 percent felt the same at the end of June.
  • At the beginning of 2015, 9 percent of IT leaders lacked confidence in their IT department’s ability to satisfy business demands. Slightly more report they lack confidence as they finish out the first half of the year, with 12 percent and 13 percent reporting a lack of confidence in the end of March and June, respectively.
  • Findings: As IT leaders start to see the reality of their budget levels settle midway through the year, attitudes have shifted towards a more defined opinion.  Of the 7 percent decrease in those without a firm opinion at the beginning of the year, 3 percent express more confidence and 4 percent express less confidence in their department’s ability to meet business demands.  As of the end of June, the number of leaders that express confidence is at its highest level.

Majority of Most and Least Impactful IT Trends Stay Consistent; DevOps Rises

  • Throughout the first half of 2015, security, mobility, cloud computing and business intelligence (BI) / Big Data ranked in the top five initiatives with the largest impact on organizations. Security maintained the top spot as originally forecasted, while mobility rose from No. 3 at the beginning of the year to No. 2. DevOps, originally No. 10 in the forecast, rose to No. 3. Meanwhile, cloud computing was originally forecasted at No. 5 and rose to No. 4, while BI / Big Data dropped from No. 2 to No. 5.  
  • Since the beginning of 2015, open source, VoIP / unified communications, social technologies and consumerization of IT rank among the least impactful initiatives. Data center consolidation, while originally expected to be the No. 6 most impactful area heading into 2015, sits at No. 12 midway through the year.
  • The initiatives that fluctuated the most were DevOps, which rose seven spots, and data center consolidation, which fell six spots.

Security Professionals and Architects Identified as the Most Difficult to Hire

  • Security professionals, programmers and developers, software engineers and project managers remained in the top five most difficult positions to fill in the first half of 2015. Compared to the beginning of the year, security professionals rose from No. 5 to No. 1 (maintaining its top ranking achieved in Q1), architects rose from No. 3 to No. 2 (after briefly falling out of the top five in Q1), programmers and developers fell from No. 1 to No. 3 (coming in at No. 2 in Q1), software engineers fell from No. 2 to No. 4 (coming in at No. 3 in Q1) and project managers dropped from No. 4 to No. 5 (coming in at No. 4 in Q1).
  • Since the beginning of 2015, social technology experts, mobile, cloud and help desk / technical support ranked as less difficult positions to fill.  The only skill set to rise out of the five least difficult positions to fill since the beginning of the year was Big Data analytics (rising from No. 8 to No. 6), while business analysts fell to the bottom five (from No. 6 to No. 9).
  • In terms of overall change in ranking since the beginning of the year, security professionals made the biggest jump, rising four spots, while business analysts fell three spots.

Full-Time Hiring Expectations Decelerates

  • Forty percent of IT leaders expected increases in full-time hiring as they entered 2015. At the end of the first half of the year, this expectation has fallen significantly.  At the end of March, 45 percent expected full-time hiring to increase, but at the end of June, just 28 percent agreed.
  • Heading into 2015, 50 percent of IT leaders expected full-time hiring to stay the same as 2014. Midway through the year, this group has grown.  At the end of March, 46 percent expected hiring to remain the same, but 59 percent agreed by the end of June.
  • At the beginning of 2015, 10 percent of IT leaders expected decreases in full-time hiring. At the midpoint of the year, this group increased.  While only 9 percent expected decreases at the end of March, 13 percent expect decreases as of the end of June.
  • Findings: Hiring expectations for full-time employees for the upcoming quarter decelerated. Compared to the original forecast, 12 percent of the IT leaders who originally anticipated increases shifted to “stay the same” (increasing 9 percent) and “decreases” (increasing 3 percent).

Contingent Hiring Levels Out

  • Thirty-six percent of IT leaders expected increases in temporary hiring as they entered 2015. This number fell at the end of the first half of the year.  At the end of March, 51 percent expected increases, but only 29 percent expect increases as of the end of June.
  • Heading into 2015, 54 percent of IT leaders expected temporary hiring to stay the same. Midway through the year, this number remains close to the original forecast.  At the end of March, 44 percent expected hiring to remain the same, and at the end of June, 56 percent expect hiring to stay the same.
  • At the beginning of 2015, 10 percent of IT leaders expected temporary hiring to decrease. At the midpoint of the year, this figure increased. At the end of March, 5 percent expected decreases in contingent hiring, but by the end of June, this rose to 15 percent.
  • Findings: Hiring expectations for contingent workers leveled out by June 2015.  Compared to the original forecast, 7 percentage points of IT leaders who originally anticipated increases shifted to “stay the same” (increasing 2 percent) and “decreases” (increasing 5 percent).

“Hiring seems to have hit a summertime lull, as fewer leaders expect hiring to increase in the third quarter after a significant uptick at the end of March. However, it is good to see the number of IT leaders that expect budget increases is surpassing what they had originally predicted at the end of 2014,” said TEKsystems Research Manager Jason Hayman. “Additionally, their consistent confidence in their department’s ability to meet business demands demonstrates a clear understanding of how to align IT initiatives with the needs of the organization.”

TEKsystems’ Jason Hayman is available for additional commentary. For more information about the survey or to schedule an interview, please contact Rick McLaughlin at TEKsystems@daviesmurphy.com.