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Europe’s I.T. Skills Shortage Evaporates
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Adam Eisner, theWHIR.com
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From Web Hosting Monthly, October 2003 edition
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November 13, 2003 — (WEB HOST INDUSTRY
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REVIEW) — In the late 1990s, there was a great deal of media coverage
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in Europe dedicated to an impending job shortage that would decimate
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the profitability of businesses in the early years of the new
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millennium. In fact, by September 2000, research firm IDC (IDC.com)
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predicted that Europe would be short almost four million I.T. and
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e-business employees in coming years, and many other articles predicted
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similar dire situations.
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Today, the job market in Europe and many
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other parts of the world are obviously not as scintillating as they
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were in the late 1990s, proving most of these doom-and-gloom
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predictions to be incorrect.
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In defense of the analysts that made
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these forecasts, most available numbers certainly did point to an
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impending shortage of I.T. staff (barring a market downturn, of
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course). Before the tech bubble burst, many companies complained they
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could not fill their positions with qualified employees fast enough.
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Once it burst, the jobs disappeared.
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The crash of the tech sector and, more
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specifically, the telecom market, was one of several major factors
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behind the evaporation of Europe’s I.T. job shortage. During and after
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the crash, companies were left with all sorts of excess assets, from
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employees to equipment to entire data centers. The time was certainly
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not a busy one for hiring, and the job market has not fully recovered
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since.
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The second factor is a more recent trend
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that is forcing technology employees to find work closer to home: the
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United States closing its borders. The U.S. government is currently on
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track to reduce the number of work visas it offers to qualified foreign
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workers from close to 200,000 to less than 70,000, thereby reducing the
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“brain drain” has that affected countries both in Europe and worldwide
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in recent years. Previously, foreign workers armed with H-1B work visas
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would head to the United States to take up high-paying and highly
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qualified tech jobs. With the number of available visas being reduced
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by more than 50 percent, however, workers will be forced to find
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positions elsewhere, which could be good news for European businesses.
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Another factor that is creating a wide
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range of problems for many European economies is the recent outsourcing
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trend. Companies both large and small have started moving non-essential
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functions into the hands of third-party firms located in foreign
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countries such as India, where employees are highly qualified but
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demand less in compensation.
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Interestingly, a recent study by Pierre Audoin Consultants (PAC-online.com)
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suggested that Romania could soon become a similar outsourcing hub
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within Europe because of its highly skilled employees and the fact that
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most Romanian graduates speak at least one foreign language, which is
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usually English, while many others also speak German and/or French.
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Romania is also taking advantage of the fact that many Romanian I.T.
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specialists moved to the United States or Europe between 1989 and 2001,
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and are beginning to return to home to serve as seasoned project
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managers. This is also happening in several other eastern European
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nations, which means western European firms may soon be able to
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outsource their work to other countries but still within the continent
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instead of moving them offshore.
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The unfortunate news is that while the
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tech boom of the late 1990s re-vamped entire industries and markets in
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a short period of time, the recovery will not be as substantial.
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Revenues in Europe’s tech sector are not expected to pick up in the
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near future, meaning the continent’s I.T. job market is likely to
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remain slow. In fact, according to the European Information Technology
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Observatory, Europe’s I.T. services sector will see growth of only 2.8
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percent in 2003 and 4.7 percent in 2004. If there’s an upside to this
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situation, it’s that broadband penetration in Europe will likely drive
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strong growth in technology and services over the next few years -
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though not enough to create the massive shortage of qualified staff
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that analysts predicted we’d be suffering from by now.
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About theWHIR.com
Since 2000, The Web Host Industry Review has made a name for itself as the foremost authority of the Web hosting industry providing reliable, insightful and comprehensive news, interviews and resources to the hosting community. TheWHIR is an iNET Interactive property. For more information on iNET Interactive, visit http://www.inetinteractive.com
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