According to news on January 8, in 2023, although generative artificial intelligence has triggered a huge craze among companies and investors, recruitment in the information technology (IT) field has still declined sharply as companies have laid off employees and sought to cut costs. According to research by consulting firm Janco Associates, the U.S. information technology industry will add only 700 jobs in 2023, a sharp slowdown compared with the 267,000 jobs added in 2022. While AI and chat technologies have generated significant interest from businesses, the trend has not translated into more hiring activity.
Victor Janulaitis, CEO of Janco Associates, noted that the job losses seen in the first half of 2023, particularly among tech-driven companies, have impacted overall hiring for tech jobs across the industry. The company based its findings on data from the U.S. Department of Labor.
Gianulaitis explained that the main reason for job growth in the information technology field in 2022 can be attributed to the initial control of the COVID-19 epidemic. At that time, the company gradually resumed operations and rehired some laid-off technical staff.
However, he also noted that growth in areas such as cybersecurity, artificial intelligence and data science will support information technology jobs in 2022 and 2023. At the same time, some traditional enterprise applications managing payroll and HR systems are being replaced by cloud software.
Additionally, the Janco Associates survey found that hiring for entry-level information technology jobs is also beginning to decline in 2023 as artificial intelligence accelerates the automation of customer service and data center-related roles. Salaries for entry-level information technology employees increased by about 2%, while chief information officer salaries increased by 14%. In Janco Associates' most recent salary survey, CIO salaries had the largest increase of any information technology position.
Fourth-quarter tech hiring showed only a small net increase in information technology jobs in 2023. But Janco Associates said the addition of 21,300 information technology jobs in the fourth quarter was a positive sign that tech hiring could increase through 2024.
David Glick, Walmart's senior vice president of enterprise business services, said in December that the retail giant was hiring some of its laid-off employees from large tech companies while it continued to hire software developers. “I’ve never seen it so easy to recruit great people,” Glick enthuses.
Data released by the U.S. Department of Labor on Friday showed that overall employment growth in the United States was strong in December last year, with 216,000 new jobs created. Throughout the year, the number of new jobs reached 2.7 million. Although it has slowed down compared with 2022, it has exceeded the level of several years before the epidemic. However, growth in the job market remained modest, with healthcare, government, leisure and hospitality industries accounting for most of last year's hiring growth.
In the technology field, generative artificial intelligence, the technical support behind ChatGPT, although still in its infancy, is expected to become another key factor affecting technology recruitment in 2024.
Tim Herbert, chief research officer at industry group CompTIA, said: "It's clear that our hiring environment is very different now than it was in the past! Employers are no longer looking for the same volume when hiring."
Herbert also noted that while jobs in the telecommunications industry continue to decline, demand for talent in artificial intelligence and cloud computing remains strong. He mentioned that in recent months, positions with artificial intelligence and related skills have accounted for about 11% of all technology positions, indicating that companies are moving from "early adopters" to wider application of this technology.
CompTIA also found that technology manufacturing, particularly the semiconductor industry, also added about 1,600 jobs last month. Due to factors such as the increase in demand for artificial intelligence, the chip industry, which has been sluggish for a long time, has basically recovered.
For 2024, generative AI remains a focus for business technology leaders. For many, the goal this year is to prove the value of this technology, but this will require the assistance of professional talent, which is still in short supply.
From a macroeconomic perspective, many companies intend to retain existing employees, even amid widespread fears of a recession. The exception seems to be Xerox, which announced on Wednesday that it would lay off 15% of its workforce to focus on its newly established information technology and digital services division.
CIOs continue to face the challenge of tight budgets this year as mixed economic signals prevent them from making large-scale technology investments. Some companies have chosen to cut spending in areas such as cloud computing and shift funds to artificial intelligence.
Thomas Phelps, senior vice president of corporate strategy and chief information officer at Long Beach, Calif.-based software vendor Laserfiche, said he plans to freeze headcount in information technology across much of the company this year. Key roles such as governance or risk and compliance will increase due to regulatory requirements for companies.