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Forrester Says Tech Downturn Is "Unofficially Over"
alphadogg writes "The US IT market will grow by 6.6% as high-tech spending rebounds in 2010, according to Forrester Research's latest estimates. The research firm based its projections on data reported for 2009, though its fourth quarter numbers are incomplete. Forrester says hints of a recovery surfaced in the third quarter, and now the company expects the global IT market to grow by 8.1% in 2010. Forrester's US and Global IT Market Outlook: Q4 2009 reads: 'The tech downturn of 2008 and 2009 is unofficially over, while the Q3 2009 data for the US and the global market showed continued declines in tech purchases (as we expected). We predict that the Q4 2009 data will show a small increase in buying activity, or at worst, just a small decline.'"
Quoting Soup is good food by the dead kennedys;
We're sorry
You'll just have to leave
Unemployment runs out after just six weeks
How does it feel to be a budget cut?
You're snipped
You no longer exist
Your number's been purged from our central computer
So we can rig the facts
And sweep you under the rug
See our chart? Unemployment's going down
If that ruins your life that's your problem
=====
I guess it's going up, depending on who's perspective you see it from.
Does this mean I'll get a job this year?
The tech jobs market in Boston does feel less dead now than it did for most of 2009. I entered the job market in April and it was six months before I had an interview. Now I've had three in three months. It's tricky to extrapolate from those data points to locate a job offer but it does give me hope.
... now back to the bit mines.
I graduated last November. I was looking for jobs since August. I did not get any calls at least until end of November. Since then I have had an interview every day and finally had the luxury to choose from multiple offers. I know a lot of companies are starting up new projects. A lot of the jobs in my area - Computer Architecture/Systems/Networks is being driven by Cloud Computing. Datacenter style jobs are big. Most positions require experience in Fiber Chanel SAN etc or hardware for large Datacenter switches.
What makes it official? Netcraft?
Now if only people could eat inflection points.
I scream. You scream. I assume that means we're both acquainted with the problem. We proceed.
Is this a real tech boost or just places finally needing upgrades? When Vista was found to be needless for both the consumer and business market, most consumers cut spending much in technology and businesses cut any jobs upgrading. When the recession hit, they still had little reason to upgrade. In previous years, major changes happened, compare the speed boost from a 1995 Pentium to a 1999 Pentium III. Now compare a Pentium Dual-Core to a Core 2 Duo, is there really that much of a difference in the 4 years between a 2006 Pentium Dual-Core and a Core 2 Duo? Yes, if you are a gamer it might make a lot of difference, but for most tasks, you wouldn't notice the extra speed, especially when comparing a Pentium to a Pentium III. So when the hardware is good enough, the upgraded software terrible, who wants to spend the money to upgrade? Now, new hardware advances combined with software people don't completely hate (Windows 7) is giving people reason to upgrade.
Taxation is legalized theft, no more, no less.
We had a 2% cut in staff at the end of 2008. The 2% came from early retirement and not replacing people. There were a few small departments that were eliminated. Some of the people were absorbed into other departments, but not all. We haven't really added any FTE to our head count, but we have gone through a few contractors.
There were some other cuts. No company picnic at 6 flags in 2009. The holiday dinner at a nice steak house was moved to a less pricey Italian restaurant. Our company is spread out and travel was drastically cut. When we did travel the trips were very short.
I didn't loose my job, and I bought a new car in 2009. However, I know a few of those contractors would have like to stayed around longer after their contracts expired. Instead of hiring 10 people at the start of 2010, my boss is being told that she has to wait until Q3.
Tech workers are comparable well payed and in a good position. Haiti had a sudden downturn--that's real problems. Perspective and all until we all hit Singularity.
An economic downturn only affects those who get laid off...
Or don't get bonuses, or don't get the resources/personnel/equipment they need, or entrepreneurs...
I wasn't affected by the recession until I was laid off, awesome how that works, eh? It's a boolean state, either you're employed and not feeling the effects, or you're not employed and can't get a new job at the same level as before, or do get one, but get picked out of far more applicants than before. At which point, your boolean downturn.effect() is reset to zero.
"The most likely alternative to our forecast that the U.S. and global IT markets will recover in 2010 is a faltering tech market due to a double-dip recession that returns in 2010 after a brief two- to three-quarter economic recovery," the report reads. "Should this happen, U.S. tech purchases would decline by 3% to 4% in 2010, with a second-half decline offsetting a first-half tech revival."
Maybe if the economy has a double dip recession the politicians will learn that their stimulus plans and the continued inflationary policy of the Fed are bad ideas. By then I think it will be too late, the dollar is on a fast pace to destruction. Perhaps that's Obama's job creation plan, debase the currency so much that it will be too expensive to outsource to Indian and Russian labor. Delaying a market correction will only make it worse, Government intervention cause and prolonged the Great Depression.
The "real" (u-6) unemployment rate is about 17.5%, because the official rate only counts those looking for work. So even if 17.5% of all IT workers were laid off, 82.5% still have their jobs, so yes, it is the same for "most". I got axed along with a significant portion of my department (25%) in May when they decided to outsource a lot of that work to India, but rather than collect unemployment or bitch about it I started my own company. Head still above water...
I still cannot find the droids I am looking for...
Some people predict a second lag down. I won't be surprised if the article has been published in highest point of this year. Looking at VIX (scare factor) it could be the case.
I think Forrester is being overly optimistic. CIOs may be ready and willing to spend, but it does not mean the business (read: owner, CEO/Board, CFO) are going to jump on the bandwagon. Each purchase/hire will need to undergo a serious cost-benefit evaluation, and the lowest possible dollar paid. This is a result not only of the recession of the past year-plus, but also the very real and serious concerns businesses have of what upcoming legislation (and associated regulatory environments) is going to cost them.
Same here. I was unaffected, making $45K a year, putting into a 401K, getting decent health benefits while doing tech work for a bank (of all places) until I was laid off. We're now in mid-foreclosure. I'm getting a paid sh!t wage doing warranty repair work about 10 hours a week and it's the only work I've been able to find since I was laid off last May. I've got no health benefits, I cashed out my 401K and what was left kept us in this house long enough to learn that the bank wasn't going to work with us at all... and a year ago I was telling my laid off friends how rock solid my job was. Things went down hill fast. NotQuiteReal, you're making yourself sound like an ignorant, arrogant ass.
This morning the bean counters at NPR were figuring it was closer to 19%. Gotta make it all look good to the public though don't we.
It's difficult, but we are starting to see retirements now so don't give up hope.
Our company is so short staffed on support that customer satisfaction is starting to edge down.
The baby boomers retire at an ever increasing rate for the next 15 years now. In 10 years, 2 million extra people will retire a year (4 million total).
Good luck.
She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
Probably the same for at least 70%, given most states have only a 15% unemployment rate.
"Who is the Journal of Quantum Physics going to believe?" --Stephen Hawking
The U.S. job situation is made further worse by population growth, which is currently running around 1% annually in the U.S. (~3 million per year). After adjusting for deaths and retires, that necessitates, on average, an additional 100,000 - 150,000 new jobs to be created each month just to stay even.
Or to put it another way, in the 00s decade, there was roughly zero net job growth - there are about as many jobs today as back in 2000, but the U.S. population has grown by about 25+ million in that same time. Many of the jobs that exist today tend to pay less, when adjusted for inflation, than jobs did back 10 years ago.
Ron
You know, I hear this sort of complaint a lot, but honestly I don't feel too sorry for people who are unemployed and not actually looking. It's not THAT hard to send out a resume once a month or so.
Qxe4
It's not actually made worse by population growth, which is trivially demonstrable: if it were true, then we would all be unemployed right now, because at the time of the 13 colonies there were way fewer people than now. Where did all the new jobs come from?
In fact, every time the population grows, demand grows. Sure we need new jobs for them, but we also need new stores, new dry-cleaners, new wineries, new restaurants and a bunch of other stuff. On average population growth is job neutral.
The only problem is when you get an increase of workers in an area that doesn't need them. If somehow 10 million doctors moved to the US, it would cause problems. This should be easy to see, if you think about it a bit. Those doctors would need to retrain themselves in order to fit in to the economy (or the doctors they are replacing would).
Qxe4
If you have an established career, then it's merely difficult (but not impossible) to find a good job these days. New grads have it worse than everyone else in this economy... not only do they have to compete with each other, but they also have to compete with hordes of other people who have years of experience and are clamoring for the same jobs as the grads because they are desperate. I was told that a degree would give me a huge advantage, only to graduate right in time for this huge recession. (or minor depression, depending on who you talk to) I blame the university for lying to me just as much as I blame myself for actually believing them. New grads can send out a million resumes for all the good it would do, and it's not going to make much of a difference if there's a huge glut of unemployed workers with real-world experience on the job market. It's easy to lose hope and stop trying after 6 months or more of no results. These days, employers have all the advantages and can afford to be choosy.
"It is a denial of justice not to stretch out a helping hand to the fallen; that is the common right of humanity."
Exactly what I did under similar circumstances. My business in still fledgling, but new clients every day. Still keeping my eye out, but there certainly seems to be lots of people fighting over the same jobs, and salary offers aren't what you'd expect. I'd love to see a tech surge.
That sinking feeling deep in your gut when you KNOW you screwed up bad summed up with: {head desk} {head desk}
Surely population growth must be good for the economy overall. I imagine it increases demand for resources, partially counteracting some of the decrease in demand due to the recession. I.e. less might be spent per capita, but more is spent overall.
Hey,kid, give it 15-20 years and you will find that nobody wants to know about all your work experience and all the good jobs go to the new grads.
Keep trying for jobs, especially when you have one, try to keep debt to a minimum (easier said than done, but evaluate and compare prices on _everything_ you buy and you will find surprising variations, also save up for things as by the time you can afford it you might find you don't want it any more), remember that your employer doesn't give a crap about you, don't buy extended warranties, remember insurance payouts are just a loan that will be clawed back later.
Basically, keep struggling on and you will get your reward in the end (death).
Also, try and keep off my lawn.
They whose government reduces their essential liberties for temporary security, receive neither liberty nor security.
100,000 - 150,000 new jobs to be created each month just to stay even.
No, what you need is more wealth.
That is, you will need the resources those people will consume over their lifetime: food, textiles, space, vehicles, energy, and so forth. Plus, those people need to have it.
Of course, a sensible thing to ask of those people is to do something in return for being given those resources, e.g. get a job. But that's not a necessity.
Imagine you had robots who could do all the work we need humans for now, and because they were well built, we only rarely needed to repair, dispose and replace them. And the robot nerds volunteer to do this work on behalf of all of society.
Then there's no need for more jobs just because you have more people. Maybe one job per n people, but n >> 1.
Point being: there's no inherent value in jobs, because your job can be doing something that doesn't have any inherent value. The classical example being "9-1: dig ditch; 1-5: fill it again". What has value is the resources people want.
I was in your position when I graduated, there had been a real dip so all the poor jobs figured I'd jump as soon as conditions got better (honestly, not such a bad guess) and the good jobs always found someone with a bit of real-life experience who they didn't have to "train" to be a worker instead of a student. I know it's not a help right now, but trust me once you do have a few years experience that education will pull you out of the ranks and into senior positions. I was interviewing recently for a job and the CFO (100 man company) commented that he had a great deal of respect for my degree, even though it's 7 years since I graduated. And I got the job too, though in my case I'm just looking for a better job in an economy that is recovering much better than the US one.
Live today, because you never know what tomorrow brings
Only if the population growth is equally distributed, not when most of the population growth is in the poorer classes.
In times like these the sales are the worst field to be in. It's buyers market all the way down - employment, real estate, consumables...
"Blah blah blah." - [citation needed]
Hey, hang in there -- things will get better eventually. I graduated after the dotcom bust in 2002 so I found it pretty tough then as well. I must've sent out two hundred cover letters and job applications over the course of a year, it drove me nuts. You might have to work in another industry field for a while until things pick up. The web and tech industry is much more advanced these days, so I say now is the time to innovate and start new ventures.
It's trivially demonstrable by counting the number of people working that our population has 25 million more people not working now than in the year 2000.
Clearly something changed in the last 10 years compared to the previous 200.
zmollusc speakum de truth, at least in programming you're "senior" by the time you have 3-5 years of experience, and after 10 years few will look at you, with the assumption that you're too high-priced. It's basically like being a pop star -- you're struggling now to get noticed, and when you finally do, for a short period of time you'll be in high demand and your income will rise dramatically, but then soon you'll be yesterday's news, assumed no longer hip to the latest trends. So take some comfort that your brief flash of employability and good times will eventually come, because they sure haven't been hiring people like me with 10-15 years this past year. In perceived value, cheap > experienced, in this industry, and that's what you have going for you right now.
Attention zealots and haters: 00100 00100
Then why are stock options being sold like crazy these days ?
The Wise adapts himself to the world. The Fool adapts the world to himself. Therefore, all progress depends on the Fool.
The baby boomers retire at an ever increasing rate for the next 15 years now. In 10 years, 2 million extra people will retire a year (4 million total).
They used to be dumping money into the stock market via 401Ks, now they'll be pulling money out of the market via cashing in 401Ks. Also they used to buy stuff, which they won't be doing after retirement/death.
Folks whom understand supply and demand, you know what to do with your investments in the "medium term". Panic is OK, as long as you're the FIRST one to panic, so to speak. Folks whom don't understand supply and demand, well you keep on dollar cost averaging, OK?
"Science flies us to the moon. Religion flies us into buildings." - Victor Stenger
Well said. I'm in the UK, and it depresses me when I hear the xenophobic rants about how immigrants are "stealing" "British" jobs. Heaven forbid that someone try to do an honest day's work, get paid, and then use their wages to create more demand in the economy. Perhaps they should go off and live on an island somewhere - population 1, it should be no trouble getting a job, by their logic...
Damn straight.
In a conversation with a (fairly honest) recruiter a while back, I asked him about the market for new grads, since I had friends who were just graduating and might want some referrals. He explained that any software guy with less than 3 years of experience was considered essentially impossible to place, because statistically most techies make their biggest mistakes in the first 3 years, and all employers know this. Well, about 3 years after that policy became the norm, for some reason a lot of tech firms are having a tough time finding qualified entry level applicants here in the US and are "forced" to look at oversees applicants.
Searches on Monster and the like will bear this out: most "entry-level" positions advertised require 3-5 years of experience.
I am officially gone from
Point taken! It reminds me of this poster we had in our test lab where I first worked:
(in big bold letters)
We're making REAL PROGRESS!
(in much smaller letters underneath)
Things are getting worse at a slower rate.
404555974007725459910684486621289147856453481154 in hex is "You sank my Battleship?"
[GPG key in journal]
Talk about cherry picking, 2000 was the year with the lowest unemployment rate since the 1960s, so surprise surprise now during a recession it is higher than the 50 year minimum.
And trying to go back 200 years destroys your argument anyway. In fact you only have to go back 60 or so to see that women entered the workforce - increasing the number of people wanting to work dramatically and yet unemployment didn't hit 40%.
And ignoring the cherry picking what changed is that the unsustainability of a "service" economy revealed itself
Also the Marxian view that only the means of production matters, is a bit out of date.
I'm not arguing that view. Leave distribution and marketing to the robots; they're (by unrealistic assumption) programmed to also do that part.
The Marxian view that the only source of wealth is labor
I think I'm especially not arguing that point. At least I'm not arguing that the only source of wealth is human labour---again, leave that to the robot.
On the other hand: the robots originate from human labour. And if nobody ever works, we have no services, and nobody transforms raw natural resources into products, so we have no increase in wealth over what the natural resources are worth in their unprocessed form.
Then again, exactly what is labour? If a behaviour creates or increases value, and we see that and then label it "labour", isn't that some kind of fallacious reasoning?
Financially, my situation improved quite a bit. I switched jobs in 2008 and again in 2009, both times having several interesting options to choose from, and not having a lot of competition from other applicants, as far as I know. Especially at my last job switch, some employers were really disappointed that I didn't pick them. But even in 2008, one kept contacting me after a few months to check if perhaps I wasn't happy about the job I picked and wanted to work for them instead. I now make significantly more money while working 1 day per week less than I did 2 years ago. And I bought a new house and a new car.
From what I can tell, the programming job market has been really booming these last few years. In Netherland, at least. I don't live in the US.
(It's nice we're finally getting some. Programmers used to be terribly underpaid around here.)
... and I didn't see anything in the article that led me to believe that this upturn wouldn't just be an increase in business for hardware and software vendors. Most people working in "IT" work for other types of businesses. That hardware manufacturers and software development companies are going to see improvement is great but that's only a small part of the business environment that involves "IT".
I suspect that what Forrester is seeing is that a lot of companies may be, at long last, planning on opening up the purse strings to go out and buy the equipment and software for projects that have been on hold for a long time. Good news for the Dells, HPs, and Microsofts of the world. Call me pessimistic, but I also suspect that they'll be executing those projects with existing employees and some contractors (as needed) rather than adding actual FTEs.
CUR ALLOC 20195.....5804M
This was a concern for me as well.
However...
I think small cap will be okay (since it is always full of new companies).
International will be okay (since there are billions of investors besides the 30 millionish baby boomers.
Also, that money coming out of the market is going to be spent and then... inherited by the boomer's kids who will spend much more freely than the boomers.
I'm currently heavy cash because I expect another major leg down but that cost me a lot doing so. The dollar cost averaging portion I always put in has basically doubled.
Dollar cost averaging has worked consistently for me. Meanwhile my trading gets +30%, +35%, +52% in some years but then -10%, -20%, -30% in other years.
For long term moves I usually use the 50dma and the 300dma to catch about 60-80% of a move. But short term moves just eat me up- especially over the last year. While I think the market is manipulated by the government very heavily now (an analyst firm last week said there is 600 million dollars in the market that has no identifiable source), I still bit on the technical analysis signals that always worked for me in the past and they just don't work now.
Many baby boomers are sliding over to cash, annuities, etc. now. Even if the selling forces the market down, typically it takes the hit and then you have a new normal.
She was like chocolate when she drank... semi-sweet at first and then increasingly bitter.
You are saying we don't need jobs because of population growth, but sure we need jobs for population growth. Pick one.
Once you hit that submit button there is no going back.
"That 'downturn' hurt, bad. Being out of work for 6 months would have been nice, but there were weeks at a time when there were no tech related positions, and nobody was interested in hiring someone with "professional" work experience for even tasks such as menial labor or food service."
Uh, what?
Oh please that's the most intellectually dishonest post I've read on slashdot in a while. Did you seriously not understand my post? Is there a reason you had to chop the sentence off by the end? What is your problem anyway, why do you have to stoop to such silly logic games to make a response? Next time read the whole thing and respond to the main idea, not to sentences that you had to edit before they could vaguely support your point. When a person enters the economy, he takes a job, but he also creates a job somewhere of equal value to the amount he spends. You should be able to see this.
Qxe4
It's not made worse by the population growth. It's made worse by other factors, but the positive effect from the population growth balances the negative effect from other stuff, so you just see the population growth without economic growth.
In this case, "correlation does not imply causation" is very appropriate.
I'm in the UK ... Perhaps they should go off and live on an island somewhere
They already did, you insensitive clod!
On a serious side, immigration can drive wages down, but there are some preconditions for that. Specifically, the immigrants (or at least some part of them) must be discriminated against (not necessarily legal discrimination, it could just as well be purely social), so that they find it hard to get a job paying them as much as a native would get doing it. They are then forced into lower-paying jobs, and that drives wages down for everyone.
This is still not as simple as it sounds, because discrimination can have different reasons behind it. Simple racism is a very common one, but there is also a possibility that people do not want to integrate into their new society (learn the language, respect the societal norms etc), and society rightly shuns them back in return. Usually, it's a combination of both in different proportions. What exactly is the proportion in UK is a separate (and very long-winded) topic.
The point is, if you have job growth of 0.01% and population growth of 1%, then you have a significant under-employment problem. Obviously, between the 13 colonies and today job growth has met or exceeded population growth.
Yes, more people means more demand, which means more jobs. But given that "job growth" is the actual measurement of those jobs created, you're already taking that into account. If there are 100 million jobs and you add 500,000 jobs, you have 0.5% job growth over that period of time. You also added 1 million people to the potential workforce over that time, so even though the job pool grew by 0.5%, you have 500k more people without a job at the end. That is what he means by population making the picture worse.
I think your point is that if you had NOT had population growth of 1 million people, they would not have increased demand and therefore you would not have had job growth either, or perhaps even job decline. Perhaps without those 1 Million extra wannabe-consumers (only half of whom have the money to really participate in the economy), you would have seen 500,000 jobs lost instead of created, and you'd have seen a similar unemployment growth. That's beside the point, though. He's not saying if only we could stop population growth we'd be in good condition; he's saying that if you aren't taking population growth into account then the job growth figures look a lot rosier than they really are.
Actually, you really haven't thought it through, and that's a big part of why you're reacting so violently.
Your premise in paragraph 1: Job losses aren't worse due to population growth.
Reality: Job losses understate the actual problem being measured - a measure of unemployment. Since the US needs +100k-ish jobs to 'stay even'. That means when you lose 86k jobs in December, you're actually 186k jobs behind.
In addition, your example of the colonies was also a lousy attempt at reductio-ad-absurdum. The point is that job losses understate the problem, not that it's impossible for growth to happen. If we create 200k jobs in a month, well then 100k previously unemployed are now employed, as well as the 100k entering the work force. (assuming an ideal case)
Your premise in paragraph 2: more people always increase demand in an equal way. One more person means one more 'job-worth' of demand.
Reality: Unemployed people do not boost demand much. To use one of your examples, we do not need more dry-cleaners, as the unemployed have no clothing that needs dry-cleaning nor can they afford dry-cleaning. This problem is even worse for those 100k who are just entering the workforce, because they can not receive any payments from unemployment. They're entirely reliant on charity, be it from their family or the government. If the charity comes from their family, those people are reducing their own demand in order to support the unemployed new graduate. If the charity comes from the government, well that's reducing everyone else's demand through taxes.
Simply increasing the population doesn't make work materialize out of the ether. The new population doesn't have any money to spend to create demand.
Your premise in your reply: When a person enters the economy, he takes a job, but he also creates a job somewhere of equal value to the amount he spends
The point your missing: They aren't taking a job. They are the 100k people who could not 'enter the economy'* because we lost jobs in December, in addition to the 86k people who 'left the economy'* when they lost their job.
* I'm using your definition of 'enter the economy', not a more complete definition from economics.
All your descriptions of problems are temporary. In the long run, it all evens out.
Qxe4
In the long run, we're all dead so nothing matters.
To drop the sarcasm, no actually it doesn't even out. Those 100k people who didn't enter the workforce in December? They're behind now. They will be making less money for the rest of their lives, because they won't have as much experience. For example, when they're 35 they might only have 8 years experience instead of 12. That's going to result in a significant loss of income.
So actually, it's a pretty big deal.
They will be making less money for the rest of their lives, because they won't have as much experience.
Sometimes life kicks you in the balls. Some people it kicks harder than others. It doesn't matter if you're rich or poor, you have to deal with it.
Over decades, the number of years you work is significantly less important than the knowledge you have. People who win the lottery often lose it all within a few years. Many rich people have failed completely before achieving wealth.
If those people spend their time away from work doing nothing, you are right, they will be making less money the rest of their lives. On the other hand, if they use the time to increase their knowledge, they will be making more. It is entirely up to them.
Qxe4
The whole "women in the workforce" was not really anything new - it was more of an entry into the white collar jobs; they had been in blue collar jobs for millenia and some even in those white collar jobs. It didn't affect unemployment because it trickled up - as more women qualified for the jobs, more took them; but it was a slow growth.
Likewise with the population growth. It doesn't really affect the unemployment until they start looking for work - a lagging trend of about 15-25 years. So those 25 million people born from 2000 to 2009 won't really affect the job market until at least 2014-2016, when the oldest of them become eligible to work. (Minimum employment age is usually around 14 or 15, but varies from state to state.) And again, it's a trickle effect, which is why impact is negligible - and that's assuming they all live long enough to make it into the job market and be qualified to work. That 25 million is probably closer to 24.5 million by the end of it all - not a significant difference, but not a negligible one either.
Contrast that with 200 years ago - more women miscarried, more children died in infancy, more children, teens, and adults died from disease, etc. And unemployment was higher. It was only in the 1940's/1950's that they decided that 5-6% unemployment was a good target, but it was pretty arbitrarily picked.
Truth is like the sun. You can shut it out for a time, but it ain't goin' away. - Elvis Presley (source: imdb.com)
"Simple solution to achieve your wish... Deport all the cheap labor Indians on H1-B visas and there would be a huge upswing in demand for domestic IT personnel."
Or else, a huge upswing in demand for attornies with experience on outsourcing companies to cheap labor countries like India.