European IT Skills Shortage Will Increase Through 2002, IDC Says

London, October 20, 1999 – One of the hottest topics of discussion in the Western European IT industry today is the shortage of necessary skills to implement and manage new IT solutions. The looming date change and Euro compliance continue to gather momentum and soak up more of these scarce IT skills. Taking into account this backdrop, International Data Corporation (IDC) predicts the overall shortage of skilled IT professionals in Europe will grow from 5% in 1998 to almost 20% in 2002.

"As today's businesses increasingly depend upon IT for communications, the Internet, ecommerce, and electronic business, the demand for skilled labor will continue to grow year on year," said Andrew Milroy, Expertise Centre manager of IDC's European Training and Skills Management research program. "Soon the demand will significantly outstrip supply, leading to inflated salaries, increasing staff turnover, and therefore higher operating costs and lower profit margins." The arrival of the Internet economy has had a tremendous effect on businesses – with many undergoing a complete restructuring and entering new business sectors and even new markets.

IDC predicts the internetworking area will experience the most acute skills shortage. "The growth in demand for skills centered around the internetworking environment will grow more rapidly than that for any other technology environment between 1998 and 2002," Milroy said.

"Without a strategy for resolving the IT skills shortage, individual countries, and Europe as a whole, will begin to suffer at the expense of other countries and regions, which are already planning more strategically," he warned. "In October 1998, the United States attempted to address supply-side concerns by increasing its allocation of green cards to professionals with IT qualifications and experience."

The most common reaction to a gap in appropriate skills is to retrain, typically resulting in incremental operating costs. Other answers include using offshore resources (from Eastern Europe and India in particular), or designing a solution that relies more on an infrastructure rather than a tailored solution, increasingly referred to as hosted applications or new bureau services.

IDC's latest report, Europe's IT Skills Crisis – Whose Problem Is It? IDC #QC02F defines the changing nature of IT skills, discusses skills trends, and analyzes the projected growth in the shortage in Western Europe. This study also includes information on attracting, retaining, and developing employees and is available to purchase from your local IDC office.

About IDC

International Data Corporation delivers accurate, relevant, and high-impact data and insight on information technology to help organizations make sound business and technology decisions. IDC forecasts worldwide IT markets and adoption and technology trends, and analyzes IT products and vendors, using a combination of rigorous primary research and in-depth competitive analysis. IDC is committed to providing global research with local content through more than 500 analysts in more than 40 countries worldwide. IDC's customers comprise the world's leading IT suppliers, IT organizations, and the financial community. Additional information on IDC can be found on its Web site at http://www.idc.com.

IDC is a division of International Data Group, the world's leading IT media, research, and exposition company.