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Contractors must focus on knowledge-centric skills to survive Europe’s IT jobs cull

IT contractors who fail to gain knowledge centric-skills run the risk of being in one of the 770,000 IT roles that analyst The Hackett Group predicts will disappear from the European IT industry by 2017 as a result of offshoring and tech-driven productivity improvements.

“The evolving offshore job market and the maturing of global business services operations has simply eliminated many of the jobs that used to exist in IT,” explains The Hackett Group’s managing director Rashpal Hullait. “For many people in Europe seeking jobs in corporate IT, our research offers a bleak picture.”

However, Hullait highlights that the major shift away from traditional transactional IT roles offers canny IT contractors with the right skills, or the ability to acquire them, a more certain future.

“New opportunities are presenting themselves,” continues Hullait. “Staff that can develop the knowledge-centric skills that companies need to support their shift to global business services, and their overall globalisation goals, will find themselves in great demand.”

According to The Hackett Group’s research, the major factor driving the loss of so many contracts and jobs is the growth in global business services organisations and the shared service approach.

The first year cost savings of 20% and 6% each year thereafter, identified by research as resulting from using shared services are leading to the redundancy of many IT roles.

Conversely, the migration of companies towards offshore and shared business services is creating new contracts and jobs for those knowledge-centric IT professionals able to manage the offshoring and outsourcing of non-core IT, finance, procurement and human resources activities.

“Acquiring, developing, and retaining talent in these areas will be a major challenge for many companies over the next few years” believes The Hackett Group. It predicts “a significant talent shortage emerging in specific classes of knowledge-centric roles”, including those that:

  • Support the strategic transformation and globalisation of business services
  • Enable global business operations, and
  • Support the transition from a transactional business services model to one focusing more on partnership.

Highly skilled knowledge workers, such as IT contractors should be ideally placed to exploit the opportunities that Hackett believes will arise, especially as the group forecasts that “by 2017, half of all jobs will be knowledge centric, an increase of over 40% since 2002”.

Published: 10 September 2013

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