IT Industry and IT Jobs:The Correlation is Limited

A report this weekend noted that growth in IT will lag other sectors, at least in Indiana. I don't doubt the report, but remember: the health of the IT sector (or lack thereof) doesn't mean fewer IT jobs in the economy. Too often they're confused.

Michael Hicks is the executive director of Ball State University's Center for Business and Economic Research, and in his posting on the website of the Muncie, Ind., newspaper The Star-Press, wrote the center foresees a modest rebound in the second quarter, with a few exceptions:

Information technology and construction will continue to lag in the recovery. This represents lagging business investment, primarily in new plant and equipment.

Though the article discusses employment conditions caused by the recession, it never makes a direct link between a decline in the IT sector and IT jobs. Still, the reader could infer that, and such a conclusion would be wrong.

Most IT jobs aren't in the IT sector; they're in regular businesses, and though many IT pros will lose their jobs in this recession, business-technology employment will outperform other occupations, mostly because companies need them to remain functional.

But too often those who should know the difference don't. A posting this summer on Slashdot.com cites government research to contend that IT jobs were getting harder to come by. The Slashdot posting was based on an InfoWorld article that confused the information sector, as defined by the U.S. Bureau of Labor Stastistics, with IT jobs. The information sector, according to the BLS, consists of industries such as broadcasting and publishing.

According to a 2006 BLS analysis, fewer than 3% of the jobs in broadcasting and publishing are held by IT professionals. Other "information" industries also employ relatively few IT pros. Among telecom employers, for instance, a mere 6.4% hold enterprise IT jobs. Not surprisingly, a majority of software publisher's employees have IT jobs; yet, more than 40% of positions at the like of Microsoft, Oracle and their smaller rivals are held by non-IT workers.

Here's what I wrote last summer on my CIO Insight blog :

Each month, the government conducts two employment surveys, one of business establishments and the other of households. The establishment survey, the one InfoWorld cites, doesn't break down employment by occupation but by industry. The household survey—the one used to determine the national unemployment rate—focuses on occupations.

Analyzing the household survey ... shows a steady rise in IT jobs. Last quarter, IT employment reached a record high of nearly 4 million, up about 10% for the past year.

Those IT employment numbers haven't changed much over the past few months.

Sure, many IT pros will be caught up in the layoffs brought on by the recession, especially in financial services, a big IT employer. Yet, as an occupation class, business-technology workers will experience fewer jobs losses, and will more likely be able to find jobs in the coming months than many of their unemployed neighbors in other occupations, regardless of the health of the IT sector.