IT Unemployment Hits 6% Amid Overall U.S. Jobs Growth

[andhra_jp]

AI and general streamlining efforts leave tech workers in a tough labor market

The unemployment rate for information-technology workers rose to 6% in August, up from 5.6% the prior month as the boom in artificial intelligence continued to drastically alter the tech landscape.

In August, there were 148,000 unemployed IT workers, more than the 145,000 in July, according to consulting firm Janco Associates, which based its findings on data from the U.S. Department of Labor. The IT unemployment rate has been above the national jobless rate for seven of the last eight months, Janco found. On Friday, the Bureau of Labor Statistics said the national jobless rate ticked down to 4.2% in August as the economy added 142,000 jobs.

Joblessness for IT workers is at its worst since the dot-com bubble burst in the early 2000s, said Victor Janulaitis, Janco’s chief executive. And this time the culprit is AI, he said, which is causing “seismic change” comparable to that seen when personal computers came into wide use.

“The roles that are most in demand right now are roles where candidates have expertise in security, AI and the cloud,” said Steve Watt, chief information officer of Hyland Software.

Part of the difficulty recently laid-off IT workers now face is a disconnect between the skills they have and how much they expect to be paid. Big pandemic-era paychecks and IT jobs no longer exist, experts say.

“Tech hiring will stay under pressure next year, but the way companies manage talent is becoming more thoughtful,” said Dhaval Moogimane, leader of consulting firm West Monroe’s high-tech and software practice. “We’re likely to see more hiring in high-growth, innovation-focused areas, while still trimming head count in areas that aren’t core to the business.”