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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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