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Check out Eagle’s Job Centre for the best in IT job opportunities and The Eagle Blog for our CEO’s views on the industry, business, and life! |
In this issue: 4 Industry News |
Three years ago, in January 2007, there was no talk of recession, and worker confidence was relatively high. The big news was Microsoft’s launch of Vista and AOL paid $1 Billion for Tradedoubler. Two years ago, in January 2008, there was much talk about an impending recession but IDC was still bullish that Canada’s tech industry would flourish in 2008 and Gartner was predicting huge growth in the Indian IT Services Market. Dell, Palm and Yahoo all announced layoffs, while Oracle paid $8.5 Billion for BEA, Microsoft paid $1.2 Billion for FAST and SUN paid $1 Billion for MySQL. January 2009 was a different story altogether, with many impacts from the economic meltdown! There were no blockbuster deals to announce, with one of the few sizeable deals being the $775 Million purchase of Interwoven by Autonomy. Confidence with IT workers and CEOs alike was at an all time low, and there was a long list of (significant) companies announcing layoffs. Satyam announced a major financial accounting scam, DELL moved a production facility from Ireland to “low cost” Poland and former Canadian “tech star” Nortel, filed for bankruptcy protection.
So…here we are in January 2010 and there is cautious optimism in the air, but not much in the way of blockbuster M&A deals! There were several positive indicators in January particularly in the US. US GDP grew at an annual rate of 5.7% in the latest quarter; the ECRI weekly measure of the US economy reached an 18 month high; the number of lost jobs was the smallest decline since March 2008; and, CEO confidence was up. Forrester are bullish on tech spending expecting strong growth in 2010. Here in Canada, unemployment was pretty steady at 8.5%, although 2,600 jobs were lost in December. Having said that, Eagle’s experience has been a steady increase in activity of the last few months and January was one of our busiest months in a long time!
As mentioned, no blockbuster M&A deals but Oracle, Apple, EMC, and Cisco continued their fairly steady acquisition pace. Perhaps the most interesting acquisition saw PWC here in Canada return to the IT consulting business with the acquisition of Allstream’s non-telecom consulting business, several years after exiting the business by selling it to IBM.
Apple released the much anticipated (and curiously named) iPad which has received mixed reviews and received its share of humour around the name. CA also announced a replacement for John Swainson, with ex-IBMer William McCracken taking the top job.
It looks like 2010 is shaping up to be a good year, we need this recovery to keep happening and before we know it we’ll all start smiling again! This year should be a year of big change as all companies continue their relentless pursuit of the cheapest possible solution to everything that they do. We can anticipate more offshore solutions, more creative use of the web and if the employee satisfaction surveys are to be believed a mass game of musical chairs as the whole world switches jobs. Maybe it’s a great time to be in the staffing business?
Walk Fast and Smile!
For more stories and the details behind the above snippets, click here.
IT JOB MARKET ACROSS CANADA – Mini Update
General Observations:
Things appear to be headed in the right direction. Often, our industry (staffing) is the first to see a recovery as companies bring in contingent labour rather than take a risk on hiring full time. In January, we had more orders than any month last year, and currently most offices are extremely busy.
Two months ago when this report was written, the TSX was at 11,600 (which was a 52 week high) and today it’s at 11,200, so we are up and down, but generally trending up (despite this blip down). It’s again, a sign that there is no boom to this recovery, just a 2 steps forward, one step back kind of steady positive progress.
The current activity levels at Eagle are echoed by my colleagues across the industry, so after an extremely quiet December (lots of vacation time) we are seeing Canada start to “put the pedal to the metal”.
Canada gained 43,000 jobs in January, all in part time, pushing the unemployment rate down 0.1 percentage points to 8.3%. We have still lost 280,000 jobs since October 2008. This means that there are still very few “skills shortages” across the country, but that will come as the jobs come back.
The deficit is still a concern, at a projected $55.9 Billion, particularly because the government is proposing a five year plan to basically reduce it to “acceptable levels”. That typically means reduced spending and increased taxes, neither of which will be good for the average Canadian business! Couple that with Canada’s first trade deficit since 1975 and we still have some way to go in this recovery!
More Specifically:
The GTA (Greater Toronto Area) continues to be one of our hottest markets, with the order flow as high this month as it has been in a long time. The increased activity now seems to be fairly widespread across most sectors, although we certainly are not seeing the kind of “craziness” we saw through the boom times. Provincial and municipal governments seem to be moving on a number of fronts after a bit of a quiet time, that is good too.
Western Canada is starting to pick up again now too, with Calgary in particular getting quite busy. Vancouver has the Olympics which will likely have a dampening affect on our business, as the focus shifts to the games themselves as opposed to the “business” of preparing for them. The sheer numbers of people in and around Vancouver will cause disruption to work days, with as many people as possible working remotely and plenty taking time off to escape the madness. Edmonton is suffering still from the effects of a provincial deficit that has seen a focus on cuts, but there are still signs of life in a city that has been growing at a very fast pace for the last five years.
Eastern Canada is warming up, we are seeing more activity in the Montreal marketplace than we have seen in some time and the Feds are continuing to spend on adding resources to help them on their projects. The large government initiatives have still not moved along, but the feeling is that there is an appetite for change and so companies need to understand where they will fit into that new agenda. Could be fun!
The following are some facts/indicators we are watching at of time of writing:
- The price of oil is a little over $72 a barrel - not so low as to affect existing projects, but not high enough to create a “boom”.
- Natural Gas prices are little higher than this time last year, having overcome a seven year low back in September.
- The TSX seems to be doing well, currently around 11,200, a positive sign.
- The Canadian dollar is strong, currently about 93.5c US. Not always a good thing for Canadian business, but a positive economic indicator.
- Prime remains at 2.25%, making borrowing inexpensive. This is good for when companies feel optimistic enough to invest!
- Canada added 43,000 jobs in January, all part time, which we believe demonstrates the value the staffing industry brings to the Canadian economy.
- Alberta’s provincial government continues to grapple with its unusual situation of a $7 Billion deficit, and the requisite cuts that go with it.
- We are seeing a pickup in activity in most sectors, banks, oil companies, and telcos in particular. There is also some pickup in Municipal, Provincial and Federal Government activity.
- Canada announced its first trade deficit in 34 years – a deficit of $4.8 Billion in 2009, as opposed to a trade surplus of $47 Billion in 2008.
- The Canadian government is on hiatus (prorogued), but given their impending spam legislation, maybe that’s a good thing. When are governments going to back off and let the economy recover before they implement more legislation that lacks “common sense”?
In Summary:
There has been, and will continue to be, the concern that this “recovery” is a bubble, and we could suffer a second recession, but fingers crossed we are tracking well. The recovery was forecast to be long and slow, and that is exactly what we are experiencing.
The staffing industry tends to see economic changes early and we are seeing a spike in demand in some markets (GTA) that have been steadily growing for some months now.
I would have preferred not to suffer the recession of the past 12 to 18 months, but given reality, I am very optimistic that things are getting better.
Top 10 Online Services and Sites for 2010
Our picks for 2010 include Web sites, Web services, and mobile sites. These sites and services, I think, have a decent shot of leaping into the limelight — and becoming household names by the end of this year. More…
2010 is the year for private clouds, a hot data centre and mobile device market, banking system rationalization, new outsourcing models, and more according to IDC. Plus, HP identifies three areas IT managers will spend money on. More…
Great Tech-Spectations Fall Short
Now that we’re well into the new decade, it might be worth noting that the year 2010 has apparently come as a bit of a technological disappointment to many. More…
IDC Canada: Global Outsourcing is on the Rise
Overall Canadian IT outsourcing market expected to reach close to $15 billion this year. Learn how to grab a piece. Research firm IDC Canada predicts the overall Canadian IT outsourcing market will reach close to $15 billion this year. And if Canadian service providers wish to successfully compete in this space, analysts say certain resources and tactics are required. More…
Gartner: CIO’s Don’t Expect IT Recovery in 2010
Two things came out of the survey: 2009 was the toughest for IT on record, and CIOs reported that 2010 would be another tough year. CIOs who survived 2009, during which IT budgets dropped by eight per cent on average, don’t expect to see business recover or IT dollars return immediately in 2010. They do, however, intend to makeover IT departments as leaner, more lightweight entities ready to respond to business needs, according to Gartner research. More…
Deloitte’s 10 Canadian TMT Predictions for 2010
Consumers and enterprises wanting to access data from anywhere, anytime and any screen is this year’s theme, but the twist is that they “need to do so economically.” The result will likely be technologies that aren’t perfect, but “good enough,” says Deloitte. More…
Technology Comes to the Rescue in Haiti
International aid workers are scrambling to rebuild communications in Haiti following the devastating Jan. 12 earthquake, while people outside the country are using high-tech means to raise money for relief. More…
ICTC Project Update: Request for Participation of Software Professionals
The Information and Communications Technology Council (ICTC) is successfully moving forward to create a professional ICT certification program, I-ADVANCE© This program will complement existing vendor certifications by recognizing technical knowledge, industry experience, business and interpersonal skills. It will provide a clear roadmap for ICT professionals to advance their careers and give employers a national standard to guide their human resource decisions. More…
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For more information, please refer to our website or contact the National Eagle Staffing Solutions Team (NESST) at 1-866-78NESST (63778) or via email at NESST@eagleonline.com.
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