The number of permanent and contract jobs in the IT sector increased over the last 12 months but according to a latest report from KPMG and the Recruitment and Employment Confederation (REC) growth has decelerated since the first quarter of 2010.
Dave Pye, director of the REC's technical sector said "IT employment prospects are certainly better than they were a year ago and we've seen something of a permanent jobs-led recovery." He added "But growth is slowing now."
Despite the contraction, Pye said he did not believe that the number of IT jobs would continue to decline but to fluctuate much as it did, in the years before the economic crisis and recession.
The report shows a shortage of permanent .Net developers and a shortage of contract CAD operators over the year. It also revealed that permanent and contract business analysts and general IT staff were also in short supply.
"There will always be opportunities in niche areas such as security, business analysis and programming management," said Pye.
In the overall economy the report shows in August the number of people placed in new jobs by recruitment consultancies continued to increase, but growth slowed further from March's peak, recording the slowest increase in permanent appointments since October 2009.
The public sector has been particularly hard hit as cost-reduction programmes lead to recruitment freezes and redundancies.
The report forecasts a "substantial reduction in public-sector headcount" over the coming months.
"That is the painful but inevitable consequence of the coalition government's determination to tackle the UK's massive structural deficit," said Bernard Brown, partner and head of business services at KPMG. "The big question is whether the private sector can create new jobs in sufficient numbers and quickly enough to offset the downturn in the public sector."
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