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Canadian IT Job Market April 2007

Each month Eagle's Regional Managers put together this cross Canada look at the IT job market ... here it is hot off the press!

Western Canada

These monthly Newsletter Reports for the West are beginning to sound like a broken record... a broken record... a broken record... ah... well, you get the idea! Demand is strong and skilled resources are in tight supply leading to issues such as multiple offers and turn downs; full time employees are looking at contracting opportunities and vice versa; and, the industry struggles at keeping costs in line with budgets.

So, if month-over-month there hasn't been much change... then what about year-over-year? There are certainly some interesting and noteworthy points to take away from such an analysis. First, with respect to the problems listed above, these are now common issues right across the West from Vancouver to Winnipeg, not just in the so-called "hot markets". In fact, one large employer of IT resources is considering the need to diversify geographically to ensure that their continued growth is not constrained due to lack of skilled resources.

The second major trend to note is that the spring has historically seen some slowdown in activity. Not this year! In fact all indicators show that things are getting busier! This change is most notable in centres such as Edmonton and Vancouver where activity has been building right through typical slowdown periods.

Third is IT "off-shoring". Although it was a point of discussion in the industry throughout 2006, there seems to be some legitimate activity brewing this year. Cost-savings has been the primary driver, but more and more we are hearing of companies speak of outsourcing abroad as a way to tap skills that are in short supply locally.

Finally, peoples' interest to move from full-time employment to contracting and vice versa is substantially more prevalent this year. Higher wages for contract work and the availability of a steady supply of projects are encouraging IT professionals to make the move into contracting; while long-time contractors are being convinced to take full time employment with enticing offers of flex-days, extensive vacation days, sabbaticals and in some cases, offering excellent stock options and other financial benefits.

The general industry perception has been that the IT labour market has been changing in the ways described above; however it is surprising, upon review, how far it has really come over the course of the past year. The Western Canadian IT market has experienced incremental growth over the past many months and it is now at a level that is requiring companies to make adjustments to their staffing strategies. The role of staffing companies such as Eagle has never been more valuable as the ability to hire top resources becomes more and more challenging for the organizations needing access to these resources.

Hot skills across the West include: Vancouver - BAs, PMs, .NET Developers and Oracle DBAs, Edmonton - SAs, PMs, BAs for functional roles, .NET Developers, Testers and both functional and technical Oracle skills, Calgary- SAP skill sets (all), experience with up- and mid-stream O&G, experience with financial-based projects, Architects (all), Agile, .NET, Testers, Winnipeg - PMs, BAs, experience with financial-based projects and Permanent Placement - Axapta, .NET Developers, SAP skill sets (all).

Greater Toronto Area (GTA)

It was a busy month again in the GTA in both the contract and permanent staffing. There were many new job postings and many interviews conducted. The Ontario government has many new development projects in the works and it is expected that more resources will be required as these projects ramp up.

So, what is Driving Demand?

IT Security - IT security is expected to grow 14.2% per year from now until 2010 (IDC Canada). For example, IBM will double the number of staff to 150 at its Markham Security Operations Centre over the next three years to help companies set-up and monitor security systems.

More Robust And Flexible Application Development Platforms - Financial and consulting service multinational firms see Toronto as key market for "near shore" development projects outside of the United States. These large-scale investments with over 50 employees are creating internal "software product factories". This new demand has been driven by the GTA's geographic proximity, relative lower labour costs and the local talent pool. This trend has been largely driven by the requirements under SOX mandating that organizations host part of their mission-critical transaction systems outside of the New York metropolitan area to mitigate risk in the event of future terrorist attacks.

Legislated Security Requirements - Under the Ontario Bill 198, also characterized as Canada's toughest standards, public companies will be required to comply with strict security processes. The bill is expected to take effect June 2009. As a result, larger organizations are investing in permanent, in-house resources to oversee risk management in their IT divisions.

Over this past month, there has also been some indications that companies are finally recognizing that the market is heating up and that they will need to react more quickly in order to secure qualified applicants. This is just the beginning but we expect to see more change in this area over the next couple of months.

As is the case with many of Canada's urban centres, contractors continue to interview aggressively and are being presented with multiple offers. Pay rates are on the rise and (unfortunately!) contractors are leaving their contracts early to take advantage of these increases.

Hot skills in the GTA include: BI Specialists with Cognos Technologies, IT related Healthcare professionals, Java and J2EE - Developers and Architects, Peoplesoft - Functional and Technical, SAP - All Modules, PMs, QAs, Remedy, Ingenium and BAs with Brokerage skills. In demand skills for full-time positions include: Systems Security (process and systems), Compliance Specialists (Cobit, ISO, ITEL), Java(J2EE, XML, EJB) Developers and Architects especially with experience in trading systems in the financial services sector, and Release and Configuration Managers.

Eastern Canada

National job growth numbers continuing to astound analysts with the news that more than five times the expected number of new jobs (55,000) were created in March, in spite of a strong loonie, a slowing US economy and trouble in most of Canada's large export industries. The news in Eastern Canada was not quite as buoyant for the technology sector. In Ottawa, there was a loss of 1,000 technology jobs in March bringing total technology employment to 56,900, about the same as last year's March figure. The Ottawa technology market outside of government or as some refer to from days past as "Silicon Valley North", continues to struggle to find its identity. Long known as the R&D capital in Canada, (in fact Ottawa has the highest per capita expenditure on R&D in the country) as a result of the hey days of Nortel, Newbridge, JDS and all the spin-offs from these once mighty giants of telecom, the landscape now is different and made up of some 1,800 companies of which well over half consist of 10 employees or less. Commercialization of R&D products still seems to be the challenge with most of these new companies and until that is overcome, the Ottawa technology job market will likely continue to be one that lags the more robust and diverse regions of Central and certainly Western Canada.

We continued to see fairly strong demand across the Federal Government, albeit slower than the early winter. We have also seen very strong upward pressure on per diem rates of late as a number of locked-in long-term contract rates expire and consultants look at multiple opportunities. Several other departments are anxious on a couple of front s, one being the status of their current Standing Offers and contracts that are soon to expire and secondly, rumblings at the senior bureaucratic levels of a spring/early summer election. With respect to the former, many in government are anxious for 'The Way Forward' or the new 'Task Based Standing Offer' to finally be in place sooner rather than later, both to replace expiring contract vehicles, as well as provide a simplified, quicker and more efficient means to procure IT consultants. Although a general election will not derail this initiative, there are still others who are nervous that yet another election will stall even further other large scale technology initiatives planned in many departments.

Hot skills continue to be SAP - particularly the HR, SD and IF/CO modules, Web Developers with Java, JEEP, .NET and VB skills. In addition several organizations are in need of Senior BAs and PHs, as well as Security Specialists.