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Spring 2009 |
» The State of the IT Services Industry: Beyond the Headline
» IT Employment Declines Again in March
» The Tower of Techno-Babel: What Languages Do Devs Love Now?
» America's New Profession: Bloggers for Hire
» Lab Breakthrough Brings Instant-On Computers Closer
» Return to Index Page
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| The State of the IT Services Industry: Beyond the Headlines | Top |
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CEO TechServe Alliance
Over the last few months, the most commonly posed question by owners and executives of IT services firms is: how is the industry doing? The question is not surprising. However, an answer to the question does not lend itself to a mere cursory review of the headlines.
The Numbers: Beyond the Headlines
To read the headlines of the New York Times, the Washington Post, or the Wall Street Journal, one could get the impression that every industry and business is on the verge of collapse. While I would not minimize the economic hardship being felt by many, the true picture is far more complex. Like almost all economic declines, the level of economic distress varies widely by industry and within industries by firm.
While our firms have been far from immune during the most recent economic pullback, IT generally and IT services in particular have in many cases outperformed other industries. According to the NACCB monthly IT employment index, national IT employment peaked in November 2008 at over 4 million jobs. While IT employment experienced significant monthly declines in December and January along with a more modest decline in February, IT employment is still effectively flat year-over-year. Over the same time period, general U.S. employment shed over 4 million jobs with industries such as automotive and financial services experiencing outsize declines in employment.
Given that “flexibility” is a core element of the IT Staffing Industry’s business model and value proposition, it is not surprising that the impact of the downturn is somewhat more pronounced than IT generally. While IT staffing appeared to have been largely resilient until November 2008, consultant headcount is down on a national basis 12.3% year-over-year (January 2008 – January 2009) with the decline occurring in the last few months. While a retrenchment of any magnitude is never welcome, one should view the decline in perspective: the median firm in our industry experienced double digit growth the preceding three years (2005: 13.1%; 2006: 11.8%; 2007: 11.2%). While a discussion of “medians” can mask real hardship among individual firms, the industry as a whole appears to be faring better (to date) than it did during the last downturn. Following the bursting of the tech bubble, the Y2K hangover, 9/11, and the 2001 recession, the IT services industry suffered a severe and prolonged downturn. Firms in our industry led the decline and took much longer to recover than companies in other sectors. While the economic crisis appears to be far from over with the adverse consequences to be felt across the business community for some time, for some in our industry the impact has been more muted than the headlines would suggest.
Government Affairs: Beyond the Headlines
While the headlines may paint a more dire economic picture, there has been relatively little coverage of the potential impact of adverse governmental action on industry interests. With a new administration and more “labor” friendly Congress, we have begun to ramp up our legislative efforts. There is a heightened concern that there will be significant new restrictions on the H-1B program, including efforts to prohibit the use of H-1Bs in staff augmentation arrangements. While many of these restrictions are primarily directed at large foreign outsourcers, some of the legislative proposals would effectively prohibit the use of H-1Bs in any outsourcing setting. Regardless of whether your company utilizes H-1Bs, potential restrictions that go to the heart of the IT staff augmentation model should be troubling for all firms in the industry.
Unfortunately, the challenges are not merely prospective in nature. Over the last few months, the agency that is responsible for approving H-1B visas (USCIS) has been targeting IT consulting companies. While the heightened scrutiny appears to have been based on truly egregious conduct by a limited number of IT consulting companies, it has been reported that the government is imposing burdensome new documentation requirements on all IT consulting companies. Based on anecdotal reports, the requested documentation appears in some cases to exceed what is required of visa petitioners under current law. While we are opposed to any firm engaging in conduct that does not fully comply with legal requirements, we are concerned that the government is painting the industry with too broad a brush. While increased scrutiny may sound benign to some, the new documentation requirements can have the practical effect of restricting access to H-1Bs. At a minimum, the government’s most recent actions appear to be having a chilling affect on many firms that sponsor H-1B consultants. We have efforts underway to reach out to administration officials on this issue.
While headlines and for that matter most news accounts attempt to reduce issues to a simple narrative, the real picture is often far more complex. In matters of importance to the industry, we will continue to seek to go beyond the headlines and the easy narrative and offer a more comprehensive picture.
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| IT Employment Declines Again in March | Top |
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After peaking in November with over 4 million jobs, IT employment has shed approximately 150,000 jobs or 3.7%. Despite this drop, it was not until this past month that IT employment entered negative territory in a meaningful way on year-over-year basis declining 1.79% since March 2008. While small consolation for those adversely affected, IT employment continued to outperform the general workforce which has shed almost 4.8 million jobs (-3.48%) within the last twelve months.
"Given that employment has historically been a lagging indicator of an economic rebound, the continued decline in national IT employment is not surprising," observed Mark Roberts, CEO of NACCB. "While unemployment rates in many IT skill sets remain well below the national unemployment rate of 8.5%, there is very little to cheer about in March’s numbers,” commented Roberts.
The IT employment index is published by the National Association of Computer Consultant Businesses (NACCB), the national trade association representing IT staffing and solutions firms.
Technical note: NACCB’s IT Employment Index is the first specific measurement of IT employment. This unique measurement of total IT employment is created monthly by studying the ongoing staffing patterns of a dozen IT and computer related occupations in 16 industries and industry sectors employing significant numbers of IT workers including the manufacturing, wholesale and retail trade, financial, information services, business and professional services, and education and health industries. The monthly IT Employment Index is based on U.S. Bureau of Labor Statistics (BLS) data, which is subject to monthly revisions, with concomitant revisions to the Index. The IT Employment Index is also subject to annual revisions of BLS data. The IT Index was rebenchmarked in February 2009 with the publication of the BLS January 2009 employment report, reflecting significant revisions of employment data from the past several years.
NACCB 1420 King Street Alexandria, VA 22314 703.838.2050 http://www.naccb.org
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| The Tower of Techno-Babel: What Languages Do Devs Love Now? | Top |
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TechNewsWorld
IT developers are moving toward higher-level languages that make their work simpler in order to keep up with business needs.
That simplicity is found in lingos such as Java, C Sharp (C#), Visual Basic and .Net.
However, even those languages are sometimes not simple enough for the Web 2.0 world, spurring developers to also turn to dynamic languages such as PHP and Ruby, which can provide a faster return on development efforts.
Keep It Simple
Simplicity equals speed in application development, and that speed is being driven by the move to Web 2.0.
"There's a desire to build applications fast because of the speed of Internet time," IDC analyst Al Hilwa told TechNewsWorld. "People have moved to rapid development because no one knows how long new applications will survive." The recession is also forcing the move toward simplicity, according to Shaun Connolly, vice president of product development at enterprise Java application framework vendor SpringSource.
"When times are high, languages get more complex, and when there's a recession ... jobs are cut and everybody goes for simpler languages," he told TechNewsWorld.
Who's on First?
Depending on the source, Java is either the No. 1 or No. 2 programming language in terms of popularity among IT developers. IDC surveys show Java is the most widely used language, according to Hilwa. "Java is a nose ahead of .Net from a lot of the surveys we see," he said. However, Dutch firm Tiobe, which puts out a monthly index ranking programming languages by their popularity, ranked Java and C Nos. 1 and 2, respectively, in March. Tiobe searches the Web for its data. It calculates the popularity of a language by the number of lines of code developers write. Another site that rates programming languages, LangPop, ranks C as the clear leader over Java for the top slot. This ranking comes from its normalized search results, obtained by using various search engines and examining various Web sites.
On Tiobe and LangPop
Tiobe bases its ratings on three factors: the number of skilled engineers worldwide; the number of courses run in the various programming languages; and the number of third-party vendors working in those languages. Both Tiobe and Lang Pop search the Web to get their results. LangPop counts the number of people developing code in a particular language rather than lines of code, because languages like C have more lines of code than shell scripts. One should take these figures with a grain of salt, however. Tiobe's methodology is faulty, if you ask Tim Bunce, who wrote and maintains the PERL DBI module, the standard database interface for PERL. Meanwhile, LangPop says its own methodology is not scientific.
The Power of Microsoft
Microsoft's (Nasdaq: MSFT) programming languages are deeply entrenched in the enterprise. "Yes, Java is the developers' tool of choice, and the majority of new programs are now written in Java, but there's a massive set of Microsoft Windows developers," Wayne Kernochan, president of analyst firm Infostructure Associates, told TechNewsWorld. The power of the installed base of Microsoft developers can be seen in the March index of programming language popularity from Tiobe. C++ comes in third, PHP fourth, Visual Basic fifth, Python sixth and C# seventh. Meanwhile, .Net is gaining ground on Java as Microsoft continues its drive to penetrate the higher levels of the enterprise. "In very large firms, it's not unusual to find both .Net and Java development shops side by side," IDC's Hilwa said. Java and .Net are both frameworks with a set of libraries, routines, and runtime code that gets compiled, Hilwa said.
Java's Slow Slide Downward
Microsoft's strength in the enterprise may keep .Net around for a while, but Java's position may be challenged by its own complexity. "Java and its variants like Perl, Ajax, Python and Ruby, which effectively generate Java code, are unnecessarily low-level languages," Infostructure Associates' Kernochan said. "Adopting Java was, until recently, a step back in programmer productivity." That has led to programmers adopting drag-and-drop tools that hide Java's complexity and let developers do rapid prototyping, Kernochan added. "Programmers want to write browser applications and Internet architecture applications, and for that, the .Net framework per se has not so much to offer," noted IDC's Hilwa. "Java is also being ... displaced slowly, because the browser side of things is becoming more popular and the browser is now becoming the application." IBM (NYSE: IBM), for example, has a project codenamed "Opus Una," which is built around the browser as an application platform.
Dynamic Languages
The increasing need for simplicity and even faster application development to keep up with the move to Web 2.0 has led to the rise of dynamic languages such as Ruby, Groovy, Python and PHP. These dynamic languages make programming more flexible and let developers abstract and write even higher-level code so that they do not have to worry about memory management and other low-level issues, Hilwa said. However, dynamic languages are not a panacea. "They could create code that's difficult to read, that's not so structured and that's difficult to maintain," Hilwa said. "But they tend to be more productive, so you end up with a lot less code and write code more quickly." PHP is the most widely used dynamic language because it is simple and can keep up with the demands of Web application development, Hilwa added. Ruby is also widely used, especially on the Rails framework. "My indications are that there is a significant trend towards Ruby on Rails from vanilla Java, Perl and SmallTalk, and, possibly from Python," Infostructure Associates' Kernochan said.
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| America's New Profession: Bloggers for Hire | Top |
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Reprinted with permission from wsj.com
In America today, there are almost as many people making their living as bloggers as there are lawyers. Already more Americans are making their primary income from posting their opinions than Americans working as computer programmers or firefighters.
Paid bloggers fit just about every definition of a microtrend: Their ranks have grown dramatically over the years, blogging is an important social and cultural movement that people care passionately about, and the number of people doing it for at least some income is approaching 1% of American adults.
The best studies we can find say we are a nation of over 20 million bloggers, with 1.7 million profiting from the work, and 452,000 of those using blogging as their primary source of income. That's almost 2 million Americans getting paid by the word, the post, or the click -- whether on their site or someone else's. And that's nearly half a million of whom it can be said, as Bob Dylan did of Hurricane Carter: "It's my work he'd say, I do it for pay."
This could make us the most noisily opinionated nation on earth. The Information Age has spawned many new professions, but blogging could well be the one with the most profound effect on our culture. If journalists were the Fourth Estate, bloggers are becoming the Fifth Estate.
What started as a discussion forum for progressive politics and new technologies has now been applied to motherhood, health care, the arts, fashion, dentistry -- and just about every other imaginable area of life. What started as a hobby and an outlet for volunteers is becoming big business for newly emerging sites, for companies that now depend upon their reviews and for the people who work in this new industry.
All this fits with the trend toward Opinion TV. Less and less of our information flow is devoted to gathering facts, and more and more is going toward popularizing opinion. Twenty-four-hour news channels have been replaced by 24-hour opinion channels. The chatter is the story.
Demographically, bloggers are extremely well educated: three out of every four are college graduates. Most are white males reporting above-average incomes. One out of three young people reports blogging, but bloggers who do it for a living successfully are 2% of bloggers overall. It takes about 100,000 unique visitors a month to generate an income of $75,000 a year. Bloggers can get $75 to $200 for a good post, and some even serve as "spokesbloggers" -- paid by advertisers to blog about products. As a job with zero commuting, blogging could be one of the most environmentally friendly jobs around -- but it can also be quite profitable. For sites at the top, the returns can be substantial. At some point the value of the Huffington Post will no doubt pass the value of the Washington Post.
The barriers to entry couldn't be lower. Most bloggers for hire pay $80 to get started, do it for about 35 months, and make a few hundred dollars. But a subgroup of these bloggers are the true professionals who work at corporations, serve as highly paid blogging consultants or write for sites with substantial traffic.
Pros who work for companies are typically paid $45,000 to $90,000 a year for their blogging. One percent make over $200,000. And they report long hours -- 50 to 60 hours a week.
As bloggers have increased in numbers, the number of journalists has significantly declined. In Washington alone, there are now 79% fewer DC-based employees of major newspapers than there were just few years ago. At the same time, Washington is easily the most blogged-about city in America, if not the world.
Almost no blogging is by subscription; rather, it owes it economic model to on-line advertising. Bloggers make money if their consumers click the ads on their sites. Some sites even pay writers by the click, which is of course a system that promotes sensationalism, or doing whatever it takes to get noticed.
The United Kingdom has just had a major scandal in which an official at 10 Downing Street had planned to leak to a friendly blogger all sorts of lurid stories about the Conservatives, complete with descriptions of secret sex tapes. But all of it was to be made up, and the friendly blogger who was going to post it all thought it was an "absolutely brilliant" idea. Someone blew the whistle, but had the plot gone through, this blogstorm could have played a major role in the upcoming election.
As a political pollster, I always observed that the poll that often got the most coverage was the one that was different from the others, regardless of whether it was right, or whether the pollster had any track record. This is true with opinions, too: those on the extreme right or left, or those that are the most titillating, seem to drive the most traffic through their sites. The center doesn't seem to have either the edge or the passion to grab the same kind of traffic.
The implications of bloggers for hire are substantial. While many bloggers probably support unionization in general, they have no union of their own. Most have no benefits, yet they work long hours in front of computer screens which could cause a variety of health ailments. And the owners of the big sites most often pay their bloggers as freelancers, avoiding all of those taxes and benefits that newspapers have to pay for their writers.
For now, bloggers say they are overwhelmingly happy in their work, reporting high job satisfaction. But what happens if they, too, lose work; are they covered by unemployment insurance if tastes change and their sites go under? Are they considered journalists under shield laws? Are they subject to libel suits? Are there any limits to the opinions they churn out, or any standards to rein them in? Is there someone to complain to about false blogs or hidden conflicts? At the recent Consumer Electronics Show, Panasonic outfitted bloggers with free Panasonic equipment; did that affect their opinions about the companies they wrote about? There are more questions than answers about America's Newest Profession.
It is hard to think of another job category that has grown so quickly and become such a force in society without having any tests, degrees, or regulation of virtually any kind. Courses on blogging are now cropping up, and we can't be far away from the Columbia School of Bloggerism. There is a lot of interest now in Twittering and Facebooking -- but those venues don't offer the career opportunities of blogging. Not since eBay opened its doors have so many been able to sit at their computer screens and make some money, or even make a whole living.
And with millions of human-hours now going into writing and recording opinion, we have to wonder whether being the blogging capital of the world will help America compete in the global economy. Maybe all this self-criticism will propel us forward by putting us on the right track and helping us choose the right products. Maybe it will create a resurgence in the art of writing and writing courses. Or serve as a safety net for out of work professionals in the crisis. But for how long can nearly 500,000 people who are gradually replacing whole swaths of journalists survive with no worker protections, no enforced ethics codes, limited standards, and, for most , no formal training? Even the "Wild West" eventually became just the "West."
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| Lab Breakthrough Brings Instant-On Computers Closer | Top |
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Frustrated with how long it takes for your computer to boot up? That could change, say researchers who have made a breakthrough that could take the PC industry closer to truly instant-on capability for computer systems.
Scientists have found a way to add ferroelectric’s capability to silicon, which pushes the idea of building a completely ferroelectric transistor closer to reality.
“If ferroelectric transistors are ever realized, they can be turned off and back on instantly — no reboot, no 30-second wait, no nothing,” says Darrell Schlom, lead researcher on the project and professor of material sciences at Cornell University. “For the user the computer would be ready to be used again immediately when power is applied.”
Ferroelectric materials provide low-power, high-efficiency electronic memory and are already used in smart cards for subways and ATMs, among other things. Integrating ferroelectrics with silicon-based circuits like those in modern electronics would enable instant-on capability, and it could also provide higher speed and lower power consumption overall, making the ferroelectric circuits an attractive alternative to flash and other memory technologies. But integrating the two materials in a transistor has eluded researchers for more than half a century.
For the project researchers from three universities — Cornell, Penn State and Northwestern University — took strontium titanate, a normally non-ferroelectric variant of the ferroelectric material used in smart cards. They deposited it on silicon in such a way that the silicon squeezed it into a ferroelectric state.
So far approaches to instant-on computing have been software-driven, with companies such as Microsoft promising to create better operating systems that would cut down boot up time from a few minutes to 30-45 seconds. Phoenix Technologies has also attacked the problem with a super-lightweight operating system called Hyperspace designed for quick and easy access to e-mail, calendar, and other basic functions without having to boot into a full-blown OS like Windows; Hyperspace has recently shown up in some netbooks.
But materials science researchers have been pursuing an alternative track for decades.
In 1995, Bell Lab researchers first realized the benefits of a ferroelectric transistor. They used glue to attach various ferroelectric materials to semiconductors, says Schlom, but the result was not what they had expected because of the intervening layer of glue.
Since then attempts to get truly nonvolatile ferroelectric transitor technology haven’t succeeded. Most have resulted in ferroelectric transistors that have data retention time, also known as operational lifetime for a memory card, of few hours to a few days. That means they could hold data in memory for a few days (or less) without being powered. It’s an improvement over volatile RAM, but significantly short of the storage industry’s ten-year retention requirement for a non-volatile memory device like a flash memory card.
But that’s changed, says Schlom. “In subsequent work, the glue has been replaced by thinner intermediate layers, but ours is the first with no intermediate layer between a ferroelectric and silicon,” says Schlom. “Our ferroelectric is made directly on silicon.”
Schlom says the research team is still a ways off from its goal of creating a complete ferroelectric transistor. And he won’t take a shot at speculating just when these transistors could become a reality. “We have just gotten rid of all of the intermediate layers,” he says. “There could still be trouble with electronic traps at the interface, electrical leakage through the ferroelectric since it is quite thin and manufacturability.”
But the latest breakthrough is an important step on the road to a new kind of silicon transistor, says Schlom.