Cautious employers and a lack of experienced candidates means it's taking job seekers 50 per cent longer to find positions, according to a study from US outplacement specialist Challenger Gray and Christmas (CGC).
But even when the market starts to pick up, the majority of technical job opportunities are expected to come from outsourcing specialists, the company warned.
"Right now, no one is bold enough to anticipate a sudden turnaround for this economy so, even when business starts to improve, most companies will proceed with great care," said CGC chief executive John Challenger.
He warned that widespread layoffs across the IT sector mean that even good candidates are finding it much tougher to stand out against fellow job seekers. The market is predicted to tighten even further in many sectors as outsourcing continues to gain momentum.
"Outsourcing is recognised more and more as the safest and most economical way to quickly calibrate workforce levels to the changing economic tide," said Challenger.
At around 40 per cent, outsourcing represents the largest segment of the UK software and IT services market and outsourcing activity is predicted to grow by 17.4 per cent to £8.1bn in 2001, according to figures from analyst Ovum Holway.
"If it weren't for outsourcing, the UK's software and IT services industry would be in recession," said analyst Anthony Miller.
But Miller advised job seekers that outsourcing companies' expectations of candidates tended to be higher than for end user recruiters.
"The type of skills in demand will be the same but outsourcing companies have more stringent qualifications and demand a better class of people," he said. "The people they employ are providing a service to clients. IT is their business so they tend to set the bar higher."
Challenger predicted that the increase in job search times and prolonged unemployment could result in more business startups, particularly among younger professionals affected by the current wave of heavy downsizing.
"The entrepreneurial spirit will not be suppressed by the economic downturn, although some will bide their time until a recovery is more certain," he said.
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