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Canadian IT Job Market - Quarterly Outlook April 2008

This is a look at the Canadian IT Job market across Canada from our company's perspective. We have offices in 10 cities across the country and our three General Managers have tapped into their market knowledge to write this ... hope you find it helpful. I will stress that this is not a scientific or statistical look at the market ... this is what we say day in day out "in the trenches" of the war for talent across Canada.

Business picked up right across the West in the first quarter of 2008. Companies began the new calendar year by kicking off new projects and re-committing to older projects that were left unfinished over the year end break. Many companies have set their budgets for 2008 to be as large or larger than their 2007 budget, and several large organizations are placing a greater focus on cost control this year. Businesses have asked IT/IS to "do more with less" and this is forcing them to hold firm to their rate tables. The result has been that companies are being highly selective in the hiring process, as well as very rate conscious leading to longer than typical decision cycles.

More companies have been interested in hiring permanent employees and many contractors have been making the switch. Why the sudden interest in permanent employment? There does not appear to be any specific trend. IT contractors are still bullish on the Western economy as contract opportunities continuing to grow. A possible motive is related to the "phase-of-life" of a contractor and their risk profile. Many contractors in the later part of their careers desire benefits, stability, predictability, and, in some cases, a place where they can contribute as they work out their final years to retirement.

In Vancouver, organizations have been watching the IT contractor market to evaluate the possible impact of the coming Olympics, as well as the effects of Microsoft opening their new office. These organizations are concerned with retention and are using longer-term initial contracts and extensions to protect themselves. Security has been a hot skill in Q1 on the mainland.

Victoria still has a large base of mainframe users and these skills have been disappearing as people begin retiring.

In Edmonton, there has been an increased supply of helpdesk resources in the market as Dell begins to wind down their operations. PMs, BAs and .NET resources were in-demand over the quarter...notably absent was demand for Java Developers who had been in very hot demand at this time last year.

PMs, BAs and Program Managers with O&G experience continue to be sought after in Calgary, in addition to ERP professionals - most notably SAP with some interest in professionals with JDE skills as well.

In Manitoba, the provincial government has been looking for both functional and technical SAP resources, PMs and BAs. Oracle skill sets were also in demand in Winnipeg. With Viterra (Agricore's merger with Sask Wheat Pool) moving operations out of Winnipeg, it is expected that there will be a large number of IT professionals available for work as we enter the summer months.

The GTA continues to experience large amounts of activity and plenty of success in the Information and Communications Technology sector. Many Toronto companies recently found themselves on a variety of Top 50 lists including the Branham Top Tech 50, Deloitte Fast 50 and Profit Magazine's Top 50. Moreover, a study by the IBM Global Location Strategies Team determined that Toronto's ICT sector continues to rank with other world leaders. The success of these technology-based companies is creating many job opportunities for both those in the technology industry, as well as other professions.

Unemployment in Toronto is lower than it was at this time last year. Throughout the past quarter there was more participation in the workforce, though, which resulted in a slight unemployment increase from February to March. Despite this statistic, many sectors continued to see an increase in hiring activity including the telecom and government sectors.

The Task-Based Vendor of Record (VOR) for the Ontario Government expired at the end of March causing a scramble within the Provincial Government Sector as the evaluation for the most recent RFP to replace this contract vehicle has not yet been completed. Hiring managers have been put in an awkward position as they delay the hiring of new resources in hopes that the completion of the evaluation will come quickly. Though they are not completely without options, the available options are limited and more costly from both a time and financial perspective.

Opportunities for both IT contractors and professionals looking for full-time work remained hot, with permanent placements continuing to show increased activity. IT professionals have more options available to them, especially those looking for full-time employment as they continue to receive more than one offer in addition to counter offers.

Over the past quarter, there was a huge increase in needs for functional consultants, PMs, and BAs. There was also an increased need for niche skills such as Plumtree and ITIL while the hot skills for the region included Java, .NET, SharePoint, and ITIL.

In Eastern Canada, spring continued to wrestle with winter for attention, with the latter holding on till the bitter end, as companies saw more "snow days" affect projects with more unexpected down time than recent memory can recall. That being said, activity over the winter months continued at a fairly strong clip undeterred by the effects of Mother Nature. It really, however, was a tale of two different sectors as private companies seemed decidedly more affected by the plethora of bad economic news of late than government. Most observers are confident that any ill effects of a US downturn in Canada will spillover and hit sector by sector rather than in an across the board, uniform, negative impact to our economy and jobs.

The federal government continues to be focused on "Public Service Renewal" and an overall more aggressive approach to targeted recruiting, particularly with an emphasis on recent grads. That being said, governments at all levels, at least for the foreseeable future, will face the challenge of lower revenues combined with greater demand for better and more services at all levels.

The Ottawa region continued to see strong demand for resources within the federal government, curtailed more than ever by expiring contracts and/or supply arrangements that see many organizations anxious to secure their current resources, acquire new an d necessary resources, and plan for the new fiscal year. With contracts nearing their natural end along with an increased focus on transparency, there is more contractual scrutiny than ever before, a painful but absolute necessary exercise. Many federal government divisions anxiously await the imminent and long awaited implementation of TBIPS, the contracting solution the government has put in place to serve most of their IT contract resource requirements. PWGSC has been actively educating their internal clients as to how to use TBIPS, are in the process of setting up a website and 800 number to assist users, and are close to going "live " with TBIPS. There is, as a result of the cumulative effects of the aforementioned expired contracts, fiscal government year end, and an imminent TBIPS, a sense that there exists a pent up demand in government that could see strong demand for resources in that sector continue through the spring months.

In Montreal, where the economy is more export and manufacturing oriented, there was a definite dampening effect on demand as there were more full time job losses in the winter months. Not to the extent of recessionary numbers but significantly more than Western Canada. Technology requirements have not been as deeply impacted as other employment sectors and both the provincial government and the financial services sector in Montreal continue to forecast strong demand for both contract and full time IT resources for the near- and mid-term.

Skills and roles in demand in the region continue to be Project Managers, Java Developers, .NET Developers and Architects, QA /Tester resources and Oracle Financials Developers, and ETL Consultants.