U.S. IT pros face COVID-19 layoffs now, fewer jobs later

As the uncertainties over when and how businesses might regain normalcy in the face of the coronavirus, U.S. companies are pulling back on IT staffing and contractors.

now hiring board c suite fired terminated layoff job role
Getty Images

It’s not yet at the level of “Brother, can you spare a dime?” for IT workers, as it is for many workers in retail, entertainment, and hospitality. But as it becomes apparent the road to recovery from the COVID-19 pandemic will be take several years, IT pros are seeing layoffs in the U.S. and diminished prospects for future work, both as staff and as contractors.

In April 2020, IT pros saw 102,300 layoffs in the U.S., according to management consulting firm Janco Associates. And Janco has now more than halved the expected IT job growth in 2020 that it predicted just a month ago – to 40,000 versus the earlier prediction of 95,400 IT jobs.

Janco’s current projection for U.S. IT jobs this year is now 3.6 million, down from 2019’s 3.7 million U.S. IT jobs.

Companies have essentially stopped filling IT positions and halted new contract work, Janco CEO Victor Janulaitis said, based on conversations with CIOs and CFOs. That means IT pros who lose their jobs will have little prospect of employment or contract work in 2020.

“Until the public begins to feel they can go back to a normal lifestyle and companies open their doors, IT hiring will be nonexistent,” he said.

Janulaitis noted that there had been a surge in IT contract work at the beginning of the COVID-19 crisis to help set up work-at-home environments, from collabration tools to VPNs. “The demand for contractor help in this effort was high initially, but now is non-existent,” Janulaitis said. The tech startup sector is also in crisis.

Janulaitis does expect IT hiring to begin picking up at the end of the year. That’s in line with the current thinking for the economy as a whole; various U.S. Federal Reserve executives and economists have said they expect the current effective jobless rate of about 23% to fall back but still be about 10% in 2021. The official jobless rate stands at 14.7% – versus 3.5% in 2019 – but that count misses recent layoffs, laid-off people not looking for work during the crisis, and the self-employed.

Broadly, expectations of a V-shaped recovery have given way to expectations of a prolonged decline and then slow recovery, since there is no vaccine for COVID-19, treatments and testing are not available at meaningful levels to determine who can work safely, it’s not known whether infected people develop immunity, and the ramifications of the various efforts now under way to reopen parts of society and economy remains unknown.

The fate of IT positions is not immune from these general economic factors. “All of this has put IT professionals the same state as the rest of the labor market,”Janulaitis said.

This story, "U.S. IT pros face COVID-19 layoffs now, fewer jobs later" was originally published by Computerworld.

Related:
  
Shop Tech Products at Amazon