How the fiscal cliff affects IT

By Colin Neagle, Network World |  IT Management

While he acknowledges that this could mean smaller margins for some vendors, Davis says a drop in revenue may be inevitable for some. However, changes in pricing structure could make for a much brighter future than an outright loss of customers.

"I think what it means is it will just be a valley, not a cliff, for those companies, Davis says. "If we talk about a fiscal cliff, it might end up being a fiscal valley for a lot of the vendors."

IT training and the workforce

Sequestration could put funding for federal IT training and educational programs at risk. For an IT industry that's currently suffering from a skills gap in its workforce, Whitman says sequestration could make it more difficult for companies that are hiring to find adequate candidates.

"One of the big things was the skills gap, where there were hundreds of thousands of IT jobs open but they were not filling those IT jobs because there weren't people with the proper training," Whitman says. "I think with the sequestration and the decrease in education funding or training funding, I think that's another important aspect of the problems of sequestration for the IT industry."

Statistics from Indeed.com show more than 227,000 unfilled jobs in information technology, putting the industry third on the list behind healthcare and retail. And that figure may not accurately reflect the full economic impact of IT training on the U.S. workforce.

"For example, the health IT technician at a hospital, the graphic designer for a communications firm, or a data analyst at a financial services company all require an IT background, because their jobs are grounded in technological know-how," a 2011 CompTIA report on the IT job market reads.

At the time of the report, CompTIA estimated that IT skills account for approximately 5 million jobs in the U.S.

In addition to the public high school, community college and university IT courses funded by the government, sequestration puts programs for military service members at risk, CompTIA director of corporate communications Steven Ostrowski says. The White House estimates that more than 1 million armed forces personnel will transition out of the military by 2016, most of whom "are going to enter the workforce looking for work," Ostrowski says.

"There is a need for training upfront," he says. "You might know how to turn on a computer and send an email, but there's a lot more that goes into that before you can jump in and start working in the industry."


Originally published on Network World |  Click here to read the original story.
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