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Canadian IT Job Market -- Quarterly Outlook April 2009

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 see day in day out "in the trenches" of the war for talent across Canada.

This market update covers the period January through March 2009, some of the darkest months in the Canadian Winter and certainly economic conditions have added to the gloom! While Canada has been slower into the recession than the US and many parts of the world we have certainly been feeling its affects.

A year ago the IT Job Market across Canada was strong, with companies in all regions of the country starting large projects and raising the demand for IT professionals. Fast forward to this year and the job market is in a very different position. According to Statistics Canada's Labour Force survey released in March, total employment in Canada fell for the fourth consecutive month, pushing the unemployment rate up to 7.7%, 1.8% higher from February 2008. Ontario suffered the most job losses in February, followed by Alberta and then Quebec.

The good news in the IT sector is that generally, across the country, organizations are still investing in technology. The slow down is palpable, the layoffs ARE real and there is NO growth ... but SOME technology work is still happening!

In Western Canada, many industries are feeling the impact of the economy. Specifically, oils sands projects and development have stopped because it's uneconomical to operate at the current commodity prices, well completions are down 30-50% from past years, and 40% of oil rigs in Western Canada are now idle. The talk of IT off-shoring has also dwindled significantly. Companies are reducing budgets, cancelling projects, releasing contractors early, and implementing hiring freezes. Many organizations are shuffling internal resources or simply reducing the number of people on staff, impacting both contractors and employees. A significant portion of "posted" roles never close as a result of these changing priorities, project cancellations, or staff re-organizations.

Even in these hard times, though, business must get done and there are some employers who are actually seeing this situation as an opportunity to attract resources they have not been able to afford in the past or to fill permanent positions that could not previously be filled. A number of organizations in both the public and private sectors are still posting new opportunities; however, they are exercising more caution in their decision-making and approval processes. As a result, these companies are being more meticulous and cost-conscious when hiring new people, which is causing longer periods of time to finalize the deals.

Employers with new opportunities are finding that they can put less effort into their searches because the market is seeing more IT professionals available and looking for work. As the job market gets more competitive, so are contractors. Many are getting their names out wherever they can and using various strategies to find work including lowering their rates significantly; looking at broader opportunities by chasing roles for which they are over-qualified; and have been willing to locate to different regions across the country (specifically, many are coming from Eastern Canada to the West).

Other contractors are choosing to accept permanent positions. Employers with these opportunities are looking for candidates who are skilled in one area but have a wider range of experiences so they can take on other tasks as well. Specific hot skills in the permanent market right now are PMs, BAs, and QAs.

While many of these trends are consistent across Western Canada, each region has its own trends. The Vancouver and Victoria areas are very slow as many employers are showing caution and putting big projects on hold. Skills in demand here are Siebel, QA, and CRM. Similarly, Calgary is also seeing major projects being put on hold and many contractors are becoming available, but there are some pockets of hiring activity. BAs, PMs, SharePoint, and LiveLink are the major skills for this region. Edmonton's hot jobs are for Oracle, BA, and PM positions. The city's still seeing many government RFPs for IT positions, but far fewer opportunities are coming out as "live orders". Regina's IT market is still relatively strong due to government and crown corporations, as hiring remains consistent and there are fewer job cuts. Skill sets in demand include BAs and PMs. Winnipeg, however, is very slow with limited investment in new IT projects and many organizations focusing on maintaining systems and infrastructure. Hot jobs within the Winnipeg market include Network Administrators, Help Desk Analysts, and Business Analysts.

Times are turbulent in the GTA as companies from all industries are tightening their budgets, but there are still some positives to be found. The Ontario Government still has some large project initiatives on the go that will no doubt require contract resources at specific ministries. Even though the banking sector is still feeling the pinch, due to layoffs and exhausted staff, they still have a need for additional resources and, therefore, are contributing to the demand for IT contractors. One trend we are seeing in the telecommunications industry is the repatriation of offshore projects which are being staffed locally in Canada. Overall, Business Transformation seems to be the big push in GTA and several large enterprise infrastructure projects are getting underway.

While many organizations are still hiring, the job market is still fairly slow. Permanent positions are decreasing due to layoffs and headcount reductions, and many organizations that would normally only hire permanently are beginning to only engage contractors. In either case, there is a noticeable increase in IT professionals available for work in the Toronto area and they are becoming more flexible. They are more open to either permanent or contracting positions and are willing to consider jobs in remote areas that require more travel. As jobs get harder to find around Toronto, people are also willing to be a more lenient on common issues like pay rates, contract durations, and extensions without a rate increase.

Hot jobs in this region right now include Business Analysts as well as Infrastructure PMs and Architects. Senior billing resources and .NET C# resources are also in high demand.

In Eastern Canada, Ottawa continues to benefit from the engine that is the Federal Government. What has affected the market, most significantly in the smaller private sector, was a very lengthy and frustrating transit strike on top of economic turmoil and through a holiday season and beyond. The overall effect hurt technology jobs as well as the tech sector sun k to its lowest level in several years.

The Federal government continues to hire and with a stated objective of stimulating the economy it is expected hiring will continue in the months ahead. A Bid Rigging accusation by the Competition Bureau revolved around several IT contracts likely served to heighten attention on an already highly scrutinized procurement community in the Federal government and may have softened demand through March. As fiscal year end has come and gone and new budgets are either in place or being formulated, look for Federal government hiring to increase in the months ahead as stimulus projects are rolled out.

Montreal saw a definite flattening in demand as most organizations, although continuing to look for resources, have been unable to move very quickly through the hiring cycle with approvals pending or just put on hold. This was most evident in the permanent placement market in Montreal.

Hot skills in demand in the region were Oracle Functional, Business Intelligence, and Data Migration, as well as Security Specialists along with Tech Support and Help Desk positions.