North's reasons to be cheerful

Jun 4 2009 by Andrew Mernin, The Journal

TECHNOLOGY bosses in the region say there are reasons for optimism in the sector despite a report claiming a third of IT staff have suffered a pay cut due to the recession.

This week a survey of more than 1,000 staff by the Keep Britain Working (KBW) pressure group claimed that 30% of the UK’s embattled IT workforce have been hit by pay cuts. Meanwhile, 22% have had their hours reduced while 24% have lost benefits.

The report, which also says staff are being burdened with extra responsibilities, says that IT workers have been hit disproportionately hard by the recession.

The gloomy findings highlight a dip in morale among workers with more than half of British adults questioned saying they are more pessimistic about job prospects than they were a month ago.

“The UK workforce has demonstrated unprecedented flexibility during this recession, allowing organisations to explore a whole range of cost-cutting responses other than relying solely on redundancies,” said James Reed, founder of the campaign.

But in the North East, a number of IT bosses claim that the business landscape in the region is far better than the national report suggests.

Northumberland’s BNS Telecoms, which sells internet-driven services, says it has not implemented a pay cut for any of its 270 workers.

HR director Susan Fearon said: “We have made every effort to ensure we run as effectively as possible so our efforts have focused on process improvement and ensuring all departments are as efficient and co-ordinated as possible.

“This currently means tweaks to certain roles as opposed to a reduction in hours or a series of redundancies.”

Sue Ormerod, managing consultant and IT specialist at Newcastle recruitment firm Nigel Wright, believes there are some positives to come out of the recession, as cost issues push new business up North.

However, she also says there has been a 20% fall in average IT contractor rates for certain skills in the industry, with some workers suffering an even greater reduction.

She said: “There are still a number of companies who have specific technical requirements and some of the digital agencies in the North East seem to be winning work from clients in the South as they’re a cheaper alternative to agencies there.

“Generally recruitment is slower but we are finding that organisations are looking to fully utilise the systems they use and by doing so, need to retain good quality IT employees.

“Ironically, the senior IT market has shown little slowdown. Generally, IT employees are being retained where they have business knowledge and they are less likely to move favouring their current employer rather than taking a risk by changing jobs.”