July 2008

Money talks as tough economic times bite

Until recently IT workers were looking at employment conditions beyond mere money – often opting for less traveling and more flexible work hours, rather then money. But as the tough economic times start biting, ICT workers are demanding more money from employers. Some are becoming mercenary.

This is according to Karen Geldenhuys, MD of ICT-focused recruitment agency. Geldenhuys said skilled IT workers are “literally holding their employers to ransom”.

“Skilled ICT workers are job-hopping in order to earn more money in order to pay for their lifestyles. Some are just trying to keep payments up on cars and bonds; but some are really milking the situation. We recently had the experience with a candidate who was earning R336 000 and who was offered R160 000 more per annum by a competitive firm. But the candidate was made a counter-offer by the current employer which amounted to an additional R240 000, taking the total package to R735 000 per annum. These types of situations, while not an everyday occurrence, are starting to happen more frequently. These days the only thing that talks is money.”

Commenting further, Geldenhuys said the skills shortage in the ICT industry is already putting pressure on employers. “With this new demand for much higher salaries, employers are under even more pressure. If they want to retain key staff the only way to keep them is to offer generous increases in annual packages. Those companies that don’t do this – or can’t afford to – are going to lose out to those that can. These companies are the ones that will be sitting with all the skills and will be able to deliver on projects and provide good products, services and solutions.”

Companies also have to move faster when it comes to recruiting personnel. Working through traditional human resources departments – which are generally slower moving - can be to their detriment. “Skilled candidates are placed within two weeks of going into the job hunting market. Some come into the market in the morning and are already made concrete offers in the same day! So companies who do not move fast to catch these skills are certainly going to lose out. It’s a case of moving fast - and being prepared to pay more.”

Many business analysts don’t expect the economy to recover any time soon, so the “current money-hunting situation”, said Geldenhuys, “is likely to be the norm for an extended period”.