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IT 2017: Midyear Outlook Impacted by Current Political Climate; Majority of IT Leaders Say It Is Affecting Hiring Plans for 2017

For media inquiries, please contact us at media@TEKsystems.com.


2017 IT “Reality Check” Indicates Caution is the Watchword as IT Departments Balance the Needs of the Business with an Uncertain Outlook for the Remainder of 2017

TEKsystems®, a leading provider of IT staffing solutions and IT services, today released the results of its midyear IT “Reality Check,” a survey that analyzes the impact of current market conditions on IT budgets, hiring and current performance, as well as key factors IT decision makers consider as they support business demands for the remainder of 2017. In many cases, the midyear findings are compared to those originally reported in the company’s Annual IT Forecast released in December 2016. The most recent survey represents the views of over 200 IT leaders (CIOs, IT VPs, IT directors, IT hiring managers) as of June 2017. See the accompanying infographic here.

Key highlights from the survey include:

Almost Three Quarters of IT leaders Say Talent Sourcing Strategy Impacted by Current Political Climate:

Q: To what degree is the current political climate directing your talent sourcing strategy (overall results)?

2017 Midyear

Very Much

20%

Somewhat

51%

Not at All

29%

For those indicating that the current political climate has impacted their talent sourcing strategy:

 

Full-time Hiring

Contingent Hiring

My hiring has increased due to the current political climate.

37%

36%

My hiring has decreased due to the current political climate.

26%

23%

My hiring has stayed the same due to the current political climate.

37%

41%

TEKsystems’ Take: The majority (71 percent) of all respondents indicate their talent sourcing or hiring strategy is being impacted by the current political climate. That climate includes recent policy initiatives such as possible changes to the North American Free Trade Agreement (NAFTA), proposed restrictions to the H-1B visa program, Brexit and newly forged foreign trade agreements between Japan and the European Union. Clearly, IT executives and managers are determining the appropriate response to these factors, and while some are pulling back on resource allocations for the remainder of the year, others are doing the opposite. Of the majority of respondents indicating the current political climate has impacted their talent sourcing strategy, 38 percent have actually increased their full-time IT hiring and 36 percent have increased their contingent IT hiring. Comparing this to the overall percent of IT leaders who say their headcount has increased (34 percent for full-time and 32 percent for contingent hires) shows that those feeling the impact of the current political climate are, in fact, more likely to increase their headcount.

Fewer Organizations Reporting Actual Budget Increases for 2017:

Q: Which of the following best describes how your organization's current IT budget actually changed compared to the prior year's forecast?

2016 Forecast (Expectations)

2016 Midyear (Actual)

2017 Forecast (Expectations)

2017 Midyear (Actual)

Increased

37%

48%

49%

42%

Stayed the same

51%

27%

39%

39%

Decreased

12%

25%

12%

19%

TEKsystems’ Take: At the midyear point of 2017, 42 percent of organizations indicate their budgets have increased; that’s seven percent lower than the 49 percent of organizations originally expecting IT budget increases for the year. This marks a significant departure from the prior year when 11 percent more organizations saw IT budget increases by the midyear point. Further analysis reveals a net negative impact of actual budget changes by midyear 2017. This is evidenced by the seven percent of organizations reporting IT budgets are down by midyear 2017 and an unchanged number of those reporting their budgets have stayed the same—39 percent—from what they originally expected. In summation, it appears as though many IT leaders forecasted their budgets more accurately for 2017 and remain on course.

Although IT Leaders Remain Assured in Overall Ability to Meet Business Demands, Confidence Diminished for Core IT Demands:

Q: How confident are you in your IT department's ability to satisfy and support each of the following in 2017?

 

Core IT demands

Line of business demands

New initiatives

 

2017 Forecast

2017 Midyear

2017 Forecast

2017 Midyear

2017 Forecast

2017 Midyear

Confident

86%

74%

76%

74%

59%

62%

Neutral

9%

15%

17%

16%

26%

22%

Unconfident

5%

11%

7%

10%

15%

16%

TEKsystems’ Take: Overall, the majority of IT leaders remain confident in IT’s ability to meet the demands of the business whether core IT, line of business (LOB) or new initiatives. The biggest change to confidence levels by midyear 2017 is the 12 percent decrease in the number of organizations expressing confidence in being able to satisfy core IT demands. TEKsystems believes this can be attributed to the overall impact of continued IT decentralization. Core IT will continue to shoulder overall data and security responsibilities for the business as a whole, but will have less oversight into the IT decisions of other parts of the business that will impact those areas.

Programmers and developers continue to be the most difficult skill sets to fill:

Most difficult to fill IT positions

2017 Forecast Ranking

2017 Midyear Ranking

Programmers and developers (i.e., Java, .NET, web)

1

1

Architects

3

2

Big data/analytics

11

3

Help desk/technical support

12

4

Security

3

5

TEKsystems’ Take: Programmers and developers consistently remained the most difficult to fill position, with architects moving up one spot to become the second most difficult position to fill by midyear 2017. This may also be correlated to an increasing number of projects focused on specific lines of business and new initiatives versus core IT projects. The more surprising finding is that both big data / analytics and help desk/technical support have increased to become the third and fourth most difficult to fill positions, previously ranked 11th and 12th respectively. TEKsystems believes that as digital transformation continues to progress, the sheer increase in actionable data produced explains the jump in the need for those possessing big data-specific skill sets. As for help desk professionals now among the top five most difficult positions to fill, this may be a result of the need to provide workplace support for advanced productivity tools, such as sophisticated collaboration and content management applications, that have been put in place in the enterprise over the past few years. Notably, networking professionals have fallen from the 2nd most difficult position to fill to the 11th most difficult to fill at the 2017 midyear point. This is consistent with the overall trends of more projects being focused on LOB and new initiatives versus core IT projects, and the need to support implemented applications versus the need for network integration.

IT Leaders Unrealistic When Forecasting Hiring for 2017—Missing the Mark on Planned Hiring Increases; Adding New Headcount a Challenge:

Q: How much did hiring ACTUALLY change in the first half of 2017, compared to the second half of 2016?

2017 Forecast

2017 Midyear

Full-time IT staff

Increase

45%

34%

Stay the same

47%

43%

Decrease

8%

23%

Contingent IT Staff

Increase

43%

32%

Stay the same

44%

46%

Decrease

13%

22%

Q: Which of the following are the biggest barriers to hiring IT talent? (select all that apply)

2017 Midyear (Actual)

Too many candidates that don't fit the profile

49%

Lack of available talent

48%

Salaries (too high / lack of budget)

46%

Lack of workforce planning (i.e., I don't have the foresight into what skills I will need for upcoming projects)

12%

TEKsystems’ Take: IT leaders appeared to have inflated expectations regarding hiring at the end of 2016 and overestimated increases for both full-time and contingent hiring. Actual hiring decreases are also significant compared to what was expected, with 15 percent more IT leaders saying full-time hiring has decreased, and 10 percent more saying contingent hiring has decreased. As for the primary purpose for increasing IT hiring at the midyear point, 11 percent indicate it was to add new headcount, while 42 percent indicate it was for replacement/backfilling, suggesting that maintaining IT staffing levels at par is becoming more of a challenge than increasing headcount. When asked about the biggest barriers to hiring IT talent, a high percentage of all respondents identify an excessive number of candidates not fitting the profile, a lack of available talent or salary issues (too high / lack of budget). This becomes significant considering that only 12 percent indicate a lack of workforce planning is the biggest barrier to hiring—in other words, a significant number of all respondents identify common issues that could have been rectified by formal, proactive, long-term workforce planning.

“The data shows that in most areas, conditions remain steady and IT leaders are becoming better at anticipating budgets and hiring for the upcoming year,” says Jason Hayman, TEKsystems’ Research Manager. “Programmers and developers will continue to be the most difficult to fill skill sets, and with budget increases slightly down, the decentralization of IT in the organization is creating stress on IT departments to maintain traditional functions and still remain on the hook for things like data integration and information security. Overall, IT leaders are being cautious while still moving the needle in the right direction.”

“In the digital era, technology is ubiquitous, and most organizations will require consistent access to IT talent at every level of expertise in order to grow and innovate,” says Matt Hannigan, TEKsystems’ Vice President of Strategy and Marketing. “Even if access to certain talent pipelines does tighten or close, the need for that talent will remain, and organizations will have to adjust in real time or risk derailing their technology initiatives. This necessitates a greater focus on workforce planning strategies and increased creativity in the methods they employ to source new talent, train existing talent and retain all talent, the competition for which will only become more intense.”

TEKsystems is available for additional commentary. For more information about the survey, or to schedule an interview, please contact Nathan Bowen at nabowen@TEKsystems.com.

About TEKsystems

People are at the heart of every successful business initiative. At TEKsystems, an Allegis Group company, 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 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.