Skills crisis to worsen before it improves

The IT slowdown in the US and Europe has raised hopes that the region could benefit from the influx of people looking for work after being laid off in the US or Europe. At the very least it’s hoped that it will put the brakes on the regional brain drain.

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By  Zoe Moleshead Published  September 26, 2001

Regional skills|~||~||~|The IT slowdown in the US and Europe has raised hopes that the region could benefit from the influx of people looking for work after being laid off in the US or Europe. At the very least it’s hoped that it will put the brakes on the regional brain drain. However, local vendors and training centres say that the region is unlikely to benefit from the slowdown, and that the skills deficit is set to get worse before it gets better.

The IT slump in the US has failed to alleviate the skills shortage with a recent report from the Cutter Consortium revealing that IT staffing and skills remain a top concern for companies in the US.
“IT staffing, in one form or another, is a perennial issue,” says Chris Pickering, Cutter Consortium.

In attempts to rectify or at least reduce the skills deficit, US companies continuie to plunder skills from abroad. Meta Group predicts that while the US skills shortage will continue, Europe’s own skills gap will eclipse that of the US by the end of next year.

According to Meta Group and European Commission figures there will be 2.2 million unfilled IT positions in Europe by the end of next year, compared to 1.2 million in the US.

While the US and Europe tackle their skills deficits the Middle East is set to be endure a significant skills crisis of its own as local businesses struggles to find the resources to fuel the IT drive.

“We are still lagging behind, and the gap is still going to grow because we are an emerging market,” explains Melad Ghabriel, CEO of training house, Synergy Consulting & Training.

“The infrastructure here is being built more aggressively, the market is still growing. But our market here is growing at a much higher rate.”

The Middle East is also suffering from time lag with regard to skilled staff. While governments have undertaken initiatives to boost the number of skilled staff, it will take time for the workers to reach the employment pool.

“In the UAE, the government has anticipated the situation and has already implemented educational programs to bring nationals into the IT sphere. The real results have yet to be felt, but the effort is there,” adds Lisa Rutherford, manager of The Network Center, another of the local training houses.

Synergy has tied up with the Egyptian government in a bid to help train its engineering graduates. Ghabriel says the program helped 260 graduates last year, and will benefit a further 260 graduates this year. The aim of the training is to provide graduates with real world experience. Something Rutherford says is often neglected in the region.

“We have found that in this region, not enough emphasis or credit is given to actual real-world experience that backs up IT certifications.”

Synergy is looking to bring similar training initiatives to the UAE, Saudi Arabia and Jordan to help address the shortage in the networking and communications arena, which arguably faces the greatest skills deficit.

According to IDC figures the skills shortage in the ICT (information communication technology) sector in regional countries is set to almost double before 2004. Jordan and Egypt look set to suffer the most with five year compound annual growth (5 yr CAGR) in the shortage of workers set to hit 54% and 58% respectively. The UAE will register a five-year CAGR of 38% and Saudi Arabia 31%.

Ghabriel says that although training programmes are in place, simple supply and demand scenarios are taxing the skills resources of the region.

“Our business has been tripling in size year-to-year [since 1998]. But the deficit is also increasing. Still, with all the programmes and universities there is still a gap compared to what we need in the market.”

||**||Problems|~||~||~|Another problem hindering the skills training in the region is the black market, or uncertified training. All too often companies forego certfication for cheap training.

Ghabriel estimates that in the Cisco training market, the black market could account for as much as 20-25% of the total market value.

“Out of this how many get certified is another question,” comments the Synergy CEO. “They [black market trainees] cannot claim that they are certified. But I would say the chances of getting a certificate on the black market were much slimmer.”

Even if the global IT slowdown does provide the region with a glut of staff it is not necessarily a solution to the problem. as many of the local vendors also prefer to employ and develop local skills and employees.

“It is possible that with the US slowdown more people will be willing to come here, but we haven’t seen this yet, and we would always prefer local experience,” explains HP’s marketing manager, Graham Porter.

However, most sources agree that the brain drain of the Middle East over recent years is no longer such a pressing issue. The region is always going to prove a transient market for ex-patriates that move here, but as the Middle East begins to see payback on its training programmes, their own pool of local talent will strengthen.

The IT market transient nature of the market is likely to continue with employees moving from job to job to develop their skills or position.

“The IT industry is quite transient anyway,” says The Network Center’s Rutherford. “One to two years in a position is common anywhere in the world.

The incentives for locals moving abroad also seem to have diminished in recent times with pay issues and career opportunities improving in the region.

“It used to happen quite a lot, people would get the training, get certified and then disappear. But that was because the gap in salaries between us North America and Europe was quite high — now I don’t see the difference,” adds Ghabriel.

Although there is still movement in the employment market, but job swapping tends to remain regional, with workers moving from one country to another, or from one vendor or another, within the Middle East.

The skills crisis looks set to continue for sometime yet, with a greater injection and emphasis on skills required if the regional market is to put a dent in the current deficit levels. While regional governments are beginning to implement IT training initiatives, the time lag means that the current skills problems are set to continue.

With the pace of demand also set to outstrip supply in the region over the coming years, it seems the skills crisis will still be open for debate for quite a while yet.
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