Steady growth triggers optimism among IT pros

The Canadian high-tech sector appears to be on an even keel nowadays, according to a recent survey by Mercer Human Resource Consulting.

Pay levels show smooth and stable growth.

The result is greater optimism and among IT professionals here, Mercer says.

“When we ask [survey] respondents in the Canadian high-tech sector how they feel about economic conditions, we see a shift away from the recovery mentality, which is where it was a year ago, towards growth,” says Danielle Bushen, a Toronto-based principal at Mercer.

Employers across the sector are projecting average salary increases of 3.4 per cent for 2006, which compares favorably with cost of living adjustments. “Originally, 2.1 per cent inflation was projected for 2006. But since then, we’ve had hurricanes, the price of gas has skyrocketed and so on, so cost of living projections were adjusted to 2.8 – 3.4 per cent,” Bushen explains.

Increases in the high-tech sector are slightly higher than other sectors such as financial and professional services, where projections are in the 3.2 – 3.4 per cent range.

Employers are showing greater willingness to reward top performers, she says. Senior high-tech sales people, for example, have seen an increase in total cash compensation ranging from 15 to 45 per cent. This suggests companies are having better years, and will pay premium rates for skilled staff with a strong record of developing new business and increasing revenue growth.

“But they may be doing that at the expense of people who are just making the grade,” warns Bushen. “They are not giving them as much, so they can give high performers more aggressive rewards.” Human resource departments are struggling with meager budgets, and are looking at compensation strategies to differentiate the pool and ensure pay for performance, she says.

The survey also shows a steady pace of growth among technical experts such as hardware and software engineers who are supporting new business development and growth in the overall number of employees compared with last year.

“So there are no surprises in this survey, and that’s a good thing compared with bad years such as 2001 and 2002,” says Bushen.

While the current stability may be a relief, some industry experts are challenging IT professionals to take a hard look at the boom and bust treadmill in the sector.

Rajesh Setty, author of Beyond Code, believes IT professionals worldwide are facing a crisis. Technology skills, he says, are becoming increasingly commoditized, and people must look beyond acquiring whatever hot skill is briefly fashionable to get off the treadmill.

Setty has worked with hundreds of technology professionals in five countries for decades, and has observed the same pattern over and over again. Some new technology becomes hot, and employers pay premium rates for experts in the area.

People are increasingly attracted to the new technology, and put time and effort into becoming experts. The market is soon saturated, and the hot skill becomes commoditized. Premium pay rates level off – until the next new technology skill becomes hot and in-demand, and the cycle repeats.

This boom and bust scenario typically lasts about three to five years, says Setty.

“Technology professionals can only repeat this cycle maybe two to three times for 10 to 15 years,” he says. After that, it becomes very hard to keep up. When people start their careers, he explains, flexibility is high, but this decreases over time. “When they’re just out of college, they can go anywhere and learn any new technology. But then flexibility drops, they get married and have kids. They can’t say, ‘you want me in Timbuktu, I’m there!’ anymore.”

The way to get off the hot skills treadmill and to stand out from the commoditized crowd, says Setty, is to make investments of time in areas that are meaningful to both employers and oneself.

For example, he says, a manager might introduce a new employee thus: Here is John, and he works in our quality department. “The moment he does that, John is already commoditized. It is almost as though he is one of the objects in the quality department.”

However, if John distinguishes himself by excelling at user training, he will not be so easily pigeon-holed, says Setty. And if a big outsourcing firm comes along, promising to take care of the company’s quality initiatives, John will stand apart from his commoditized co-workers. “By doing training, did John get anything back? Maybe not initially, but in the long run, it saved him.”

Setty counters the perception that IT professionals have poor soft skills because they are inherently too logical and linear to deal with people issues. “No, it’s not that,” he says emphatically. “They don’t have time to do things that are not IT-related. They are always scrambling for the next new certification or technology. They are not spending time on soft skills because of the misapprehension it won’t benefit their careers.”

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