Manufacturing IT spending increases, but payrolls don't
- 03 July, 2012 10:09
Manufacturing employment has been a job bright spot for the economy, but IT workers aren't benefiting from it, a new report finds.
In the manufacturing sector, research firm Computer Economics found that about half of the manufacturers in their latest study are holding IT headcount level or cutting staff, even as they increase IT spending.
This is happening even though the White House continues to point to manufacturing as a solid plus for the economy.
Alan Krueger, the chairman of the president's council of economic advisers, wrote last month that the U.S. has added nearly 500,000 manufacturing jobs since Jan. 2010, which is "the strongest growth for any 28-month period since April 1995."
But IT managers in the manufacturing sector may have a different view. Computer Economics surveyed more than 200 firms of all sizes in the U.S. and Canada from January through April of this year.
Frank Scavo, president of Computer Economics, believes this reluctance to add to staff counts results from increasing use of outsourcing.
IT managers remain worried about the economy, and are preparing for the possibility that they may have to adjust spending before their budget year ends.
"They still do not have confidence that they will be able to spend all the money in their IT budget," said Scavo.
But while manufacturers aren't hiring staff, they are increasing their IT operational spending. The overall increase in IT operational spending is up 2.2% but for manufacturing it's in the 3.0% to 5.0% range.
Overall, 40% of all IT organizations plan to increase their headcount this year. But only about one third of manufacturers plan to add staff.
In terms of capital spending, there is an overall 2% improvement in spending at the median, and in manufacturing it is up about 4%.
Scavo believes that the caution IT managers are showing may be warranted, based on new and bearish index Monday from the Institute for Supply Management, which measures such things as new orders, backlog of orders, inventories, employment and prices. It reported that economic activity in the manufacturing sector contracted in June for the first time since July 2009, although the overall economy grew for the 37th consecutive month.
Other groups that analyze IT employment nationally across all sectors are also seeing some worrying signs, but overall IT employment still continues to increase month-to-month.
Patrick Thibodeau covers cloud computing and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at @DCgov or subscribe to Patrick's RSS feed. His e-mail address is firstname.lastname@example.org.
Read more about outsourcing in Computerworld's Outsourcing Topic Center.
Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.
Why change management doesn’t work
Larry Page wants to see your medical records
Dual-Persona Smartphones Not a BYOD Panacea
After two-year hiatus, EFF accepts bitcoin donations again
CIOs struggle to deliver timely mobile business apps: survey
Getting Real About Security Management and Big Data – A Roadmap for Big Data in Security Analytics
It’s an exciting yet daunting time to be a security professional. Security threats are becoming more aggressive and voracious. This whitepaper examines the escalating complexity for the security management environment; how to get more meaning from data already collected and the combination of infrastructure, analytic tools and threat intelligence need to drive business value from Big Data. Download now.
Building a Better Mousetrap in Anti-Malware
This story is becoming frustratingly old. Cyber threats are continuously advancing in their adaptability speed, sophistication, and degree of stealthiness. At the same time, the exposed footprint is expanding. More business operations are moving online and end-user devices—corporate-issued and user-owned—are expanding in number and variety. A reasonable question asked by executives responsible for making decisions on their organisations’ security budgets is whether their money and resources are being spent wisely. Are their businesses buying and using the best mix of security technologies to meet their needs and obligations? Read on.
Pathways Advanced ICT Leadership Development Program Course Outline and Big 6 2013
Developed by the CIO executive Council in conjunction with Rob Livingstone Advisory, Pathways Advanced is a 12-month CIO delivered, small group, mentor based professional leadership development program. Pathways Advanced brings together best practice, thought leadership and business insights for today’s most promising ICT professionals