IT Unemployment Rate Estimated at 20-Year Low

IT Unemployment Rate Estimated at 20-Year Low
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Demand is surging for information-technology workers with advanced digital skills, as more companies seek help developing data analytics, artificial intelligence and other emerging business tools.

Tech trade group CompTIA estimates that the unemployment rate for IT occupations in the U.S. dropped to 1.3% in May, a 20-year low, according to an analysis of the latest Labor Department jobs data.

As a result, employers are competing for a diminishing pool of talent. “The demand for tech talent has reached historic levels,” said Tim Herbert, the group’s executive vice president for research and market intelligence.

At the same time, many employers are phasing out older IT jobs as they shut down legacy in-house systems and shift to cloud computing, which can handle the larger workloads needed to run more data-rich applications.

“As every application moves to the cloud you need more people,” said Tom Gimbel, chief executive of LaSalle Network, a tech staffing and recruiting firm: “The technology is ever changing, so the skills you need to handle technology has to change, too. Everything is so new and it’s adding to an endless demand for new positions,” he said.

With job postings outpacing the supply of IT talent, employers face prolonged gaps in the hiring process, said Harley Lippman, chief executive of IT staffing firm Genesis10.

Many companies have been slow to develop intensive programs aimed at training new hires in Java, Python and other computer-program languages that underlie advanced tools like AI, he said

“You can’t teach this stuff overnight,” Mr. Lippman said.

He said IT recruiters should consider outsourcing some jobs regionally within the U.S. by tapping highly skilled tech workers spread across the country who may not be willing to move to a company’s headquarters.

Despite a ready pool of tech workers overseas, many employers are reluctant to take on foreign hires as a result of uncertainty around work visas and other red tape.

U.S. companies in all industries last month hired 133,000 IT workers, while tech-industry firms hired 5,800 workers—including sales, marketing and other nontech professionals—CompTIA reported.

By contrast, employers across the economy added just 75,000 jobs in all occupations, the Labor Department said Friday, with the gains in IT offset by job losses in retail, government and other sectors. Overall, May’s monthly increase was the weakest since the recession ended in mid-2009, the Labor Department said Friday. The unemployment rate held steady at 3.6%.

Beyond IT, employers everywhere are struggling with a tight labor market. The number of job openings in April exceeded the number of unemployed Americans be the largest margin on record, the Labor Department reported Monday.

Tech jobs accounted for 7.6% of the total U.S. workforce last year, up from 7.2% in 2017, and on pace to grow 13.1% between 2016 and 2026—creating roughly 8.6 million new jobs, CompTIA said in a separate report earlier this year.

Overall growth in tech jobs has remained positive despite cuts in some areas, including the information services and telecommunications sectors.

International Business Machines
Corp.

last week announced plans to shed about 2,000 jobs as part of a shift in strategy.

Write to Angus Loten at angus.loten@wsj.com

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