IDC/Microsoft research shows 1.6m critical IT jobs unfilled in Europe by 2002 12% of the total requirement —
Brussels, September 22, 1998
REDMOND, Wash., Sept. 23, 1998 – Today International Data Corporation (IDC) and Microsoft unveiled research findings highlighting the growing crisis in technology skills in Europe. IDC/Microsoft estimate that by the end of 1998 there will be 510,000 unfilled jobs in the technology sector growing to 1.6 million by 2002. These posts remain unfilled due to a serious shortage in trained and skilled professionals. This shortage will result in exorbitantly high costs for these skills, the delay of key projects, lower employee productivity and return from existing IT investment, and an increase in the use of offshore resources. All of these factors will significantly impact Europe’s ability to compete in a world where the effective use of IT investment is a growing factor in the competitiveness of business.
The research anticipates that in-house IT departments in business will grow from 8.3 million personnel in 1997 to 12.2 million in 2002. While assuming current levels of investment in training are maintained, the available pool of trained personnel will rise at a modest 6% per annum. Even though IT buyers intend to use external service providers to handle some of their needs, IDC/Microsoft still estimate the shortfall in available skilled IT professionals to be as high as 1.6 million by the year 2002.
Puni Rajah, Director of Services Research, International Data Corporation states:
“The most consistent topic of discussion in the IT industry in recent months has been the shortage of necessary skills to manage existing and implement new, IT solutions. Maintenance issues like Year 2000 readiness and accommodating the Euro continue to gather momentum and soak up more and more scarce IT skills. In the meantime the innovative IT solutions designed to take advantage of technology investment and maintain long term competitiveness are being stopped or pushed back by all but the most visionary of organisations. This will significantly effect the competitiveness of European businesses in the global marketplace.”
The research shows that despite IT acquisition in Western Europe being the second largest in the world behind North America, at $193 billion (1997) and growing at 9% per annum (1998 t0 2002), the skills shortage is making it very hard for organisations to take advantage of this investment. Valuable in house skills are being utilised to meet short term maintenance goals with the following consequences already evident:
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Rising costs – inevitably the shortage in the supply of relevant skills is increasing the cost significantly. IDC has been monitoring the average cost of contract IT professionals and has seen an increase in wages for technical staff in the past 12 months ranging from 12% to as much as 60%
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Deferred projects – for the unenlightened business, a lack of resources to implement and manage projects has meant deferring planned projects, regardless of the fact that this may reduce the organisation’s competitiveness in the wired marketplace
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Poorer employee productivity – almost two thirds of the tasks performed by IT professionals are to help users capitalise on the power of existing IT resources effectively. The skills and understanding to take advantage of all available technology is critical if IT professionals are to help users to see the full business benefits offered by IT. Any lack of such expertise will mean users are not achieving full productivity gains and businesses are therefore not as competitive as possible with even existing IT investment
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Increased offshore resourcing – the IDC has seen in recent months a growing use of offshore resources outside of Europe as a means to tackle the shortage in skilled professionals. This is done by either importing personnel on a contract basis or by actually performing projects remotely with contact maintained by communications links. This trend marks the beginning of Europe exporting jobs.
These consequences will inevitably become more and more severe when combined with IDC’s predicted growth in the shortfall in available skills and personnel in Europe. Business will find it very hard to embrace the range of widely available new technologies, specifically the Internet. This will put the European economy under greater pressure from outside.
Bernard Vergnes, Chairman, Microsoft Europe, Middle East and Africa comments:
”
The IT industry in Europe is a significant employer. According to this research, in 1997 the in-house IT industry alone employed 8.3 million people in Europe. The very positive impact that IT is having on businesses ability to compete and be successful is growing the demand rapidly. The potential is to have over 12.2 million people employed by 2002. The only thing holding this back and the increased success of European business as a result, is the training and skilling of our workforce. Lifetime learning and training is essential. Some progress has been made in Europe but not enough.
He continues:
“It was no mistake that we launched these findings at a major European Summit on Employment and Training in the Information Society. The figures show starkly that unless business and government throughout Europe take this issue seriously our economy will not take full advantage of the benefits and potential offered by the information society. We must make progress quickly on creating a more comprehensive training infrastructure.”
About IDC :
International Data Corporation provides IT market research and consulting to more than 3,900 high-technology customers around the world. With a global network of 375 analysts in more than 40 countries, IDC is the industry’s most comprehensive resource on worldwide IT markets, products, vendors, and geographies.
IDC/LINK, an IDC subsidiary, researches and analyzes the home computing market, leading-edge technologies in telecommunications and new media, and the convergence of computing and consumer electronics.
IDC’s World Wide Web site ( http://www.idc.com ) contains additional company information and recent news releases, and offers full-text searching of recent research.
IDC is a division of International Data Group, the world’s leading IT media, research and exposition company.
Founded in 1975, Microsoft (Nasdaq
“MSFT”
) is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier for people to take advantage of the full power of personal computing every day.
For more information, press only:
Emma-Louise ClarkeORTiffany Steckler
Text 100Microsoft EMEA PR
Tel: +44 181 242 4158 Tel: +33 1 4635 1002
Email: [email protected] Email: [email protected]
Notes to editors:
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The IDC Special Report compiled for Microsoft was presented at the European Summit on Employment and Training in the Information Society at the Conrad Hotel, Brussels on 22 September. The Summit was hosted by Microsoft, Baan, Cap Gemini, Exact Software, ICL, Lernout & Hauspie, Sage, SAP and Wang. European Commission speakers included Mr Jacques Santer, President of the European Commission; Dr Martin Bangemann, European Commissioner for Information Technologies and Mr P
à
draig Flynn, European Commissioner for Employment. Additional keynote speakers were Mr Bernard Vergnes, Chairman of Microsoft Europe, Middle East and Africa; Ms Puni Rajah, Director of Services Research, International Data Corporation; Mr Bill Kamela, Chief of Staff, Department of Labour (US) and Mr Jos Peeters, Managing Director, Capricorn Venture Partners, and co-founder, EASDAQ. The Summit was attended by over 150 representatives of the European Commission, national governments, policy makers and international IT firms. -
Full copies of the research findings are available on request. Please contact Emma-Louise Clark, Text 100, tel: +44 181 242 4158 (email: [email protected]).
