Ak tech sector bucking market trends of recession

MEDIA RELEASE
23rd April 2009

Auckland technology sector bucking wider market trends of recession

Amidst the challenges of the worldwide recession, the Auckland IT sector appears to be bucking the wider economic trends and thriving in many areas, according to the findings of a recent survey of hundreds of senior IT professionals.

The survey of over 450 senior managers of technology organisations in Auckland - conducted during March by award-winning IT recruitment company Potentia - indicates that the majority of IT organisations expect to see increased revenue over the coming year and a significant proportion are focusing on expansion – rather than ‘mere’ survival.

Covering aspects such as growth & change, staff acquisition & redundancies, salaries & morale, the survey uncovered a very different picture from what was expected, showing the IT industry is holding up well amidst the recession, says Josh Comrie, Potentia’s Managing Director

“In light of the current economic climate, we set out to clarify what is really happening in the IT industry, amidst a plethora of gloomy media reports of the worldwide recession – to see the signal for the noise, as it were,” he says. “However, the survey uncovered a very different picture from what we expected, leaving us very pleasantly surprised.”

The survey findings included:

- only 12% of the organizations surveyed anticipate revenues dropping in 2009-2010

- 57% expect to increase their revenue in the next financial year

- 33% are focused solely on expansion, with another 14% having it as part of their current strategy – only 8% are solely focused on survival, a far lower figure than expected

- over 60% of companies are expecting to hire in the next 12 months, with a fifth doing so currently

- more than two-thirds have not undertaken any downsizing

- only 2% of organizations have asked staff to reduce hours and/or salaries

- the vast majority of those surveyed believe that the calibre of job applicants is higher or the same than prior to the start of the recession

Potentia’s recent applicant statistics also challenge the widespread belief that a flood of new applicants is hitting the job-seekers market. The figures show only a 5% increase in the total number of job applicants when compared to the same time last year. However, there is a difference in the behaviour of those applicants, which has changed dramatically.

“Where before most applicants were driven by interest or desire and often only applied for one role, many are now applying for multiple roles and appear to be more motivated by necessity,” says Comrie. “Many of the applicants that are out there now are definitely working harder to land a new role than was the case this time last year – many now need rather than just want a new job.”

This is reinforced by recent statistics released by Seek in late March which shows the number of job advertisements it their IT&T sector down by over 50%.

“The result of this is that the current IT employment market is skewed - the same number of people are applying but to roughly half the number of jobs. This is giving employers more luxury to pick and choose carefully.”

Organisations can derive significant competitive advantages through the application of technology and during challenging times businesses may look to technology to achieve this end, meaning that the IT industry may not be suffering in the same way as the wider market in the face of the recession. A recent Stats NZ survey also corroborates these findings, showing domestic sales of IT goods and services grew by 4% last year.

“We don’t believe that the year ahead is going to be easy, but we reflect the confidence of the Reserve Bank that that the second half of 2009 will bring a recovery to this recession for New Zealand,” says Comrie. “In the meantime, we believe that businesses which ensure their IT capabilities are providing a competitive advantage are going to be in a stronger position to get through this.”

So how can organizations ensure they are using their IT capabilities to their business’s full advantage?

Tapping into the services of an experienced, dynamic recruitment organisation such as Potentia can be invaluable when it comes to ensuring organizations are equipped with the right IT talent.

Potentia, winner of the 2008 Seek Annual Recruitment Awards and a Deloitte Fast 50 Company in both 2007 and 2008, has pioneered a revolutionary approach to staff acquisition and retention - combining recruitment and personal effectiveness coaching.

A personalised coaching programme is provided to all new employees placed by Potentia for their first 90 days in a new role, at no extra cost to the employer.

This programme is available to all candidates – whether they are a helpdesk specialist or senior manager – and has proven to be particularly effective for those undertaking new roles and/or after a redundancy. The recruitment industry’s average fall-off rate – whereby new employees depart during their first three or four months – is approximately 10%; over the last two years Potentia’s has been around 2%.

In 2009 Potentia has also introduced complimentary psychometric testing to their client delivery process. Whilst such tests are well established in the recruitment industry, unlike other recruiters, Potentia does not charge for this service. A useful mechanism for understanding how a person will perform in a given role, this tool provides all parties with detailed individual insights, as well as identification of areas that may require further consideration before a hiring decision is made.

For more information on the benefits of Potentia’s revolutionary approach to staff acquisition, combining recruitment with personal effectiveness coaching, and their other business guidance initiatives, please visit www.potentia.co.nz

ENDS

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