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The U.S. economy added 288,000 jobs in June and the unemployment rate declined to 6.1 percent, according to a recently released employment report from the Bureau of Labor Statistics (BLS). Those numbers are good news but we’ll have to wait and see if they’re true signs of economic improvement or another blip on the radar as the economy shuffles forward. But IT occupations, when examined through the unemployment rate lens, show a much brighter picture.
The BLS publishes unemployment rates on a monthly basis for the IT sector. Due to the relatively small sample size, we typically report and study these rates on a quarterly basis, which helps smooth out any volatility due to short-term fluctuations. The unemployment rate for IT occupations averaged 2.8 percent in the first half of 2014, the lowest level since 2008. A low unemployment rate is an indicator of a tight labor pool, meaning there are few workers available for open positions. While we take note of the IT unemployment rate, it’s not the only market indicator of a tight labor pool. It doesn’t take a lengthy study of unemployment data to know that the supply of IT workers cannot begin to keep up with the burgeoning demand.
And while demand for IT labor remains high across all occupations, it’s markedly higher for certain occupations, with some hovering around an incredibly low 1 percent mark. So what does all this mean? Well, it’s complicated and unless you want a dissertation on statistics, you’ll have to accept the simple explanation that what we’re seeing is full employment, meaning there are virtually no workers with these skill sets available to fill open positions. IT professionals in these occupations have a great deal of control over where, when and how they work, meaning employers must create solid employee value propositions to attract the best talent.
The overall tightness of the IT market and strong demand are highlighted by several IT occupations that are consistently below the overall IT unemployment rate, with many hovering near historic levels. IT occupations such as computer network architect, database administrator, computer and information systems manager, software developer, network and computer systems administrator, and computer programmer have unemployment rates below the overall average.
Interested in learning more about what this means for IT salaries? See our infographic about IT salaries in 2014.
Jason Hayman is the market research manager for TEKsystems and an enthusiastic economic data geek.