The great brain drain

19 September 2008 Pete Swabey

As the UK IT employment market tightens, IT executives are found to be among the most likely to work abroad

The clouds hanging over the UK’s IT industry grew palpably thicker in August this year.

Half of the UK’s IT contractors, whose fortunes are early indicators of the employment market as a whole, live in fear for their jobs, according to a survey by IT staffing solutions provider InterQuest. Just six months previously, only 12% of contractors surveyed had concerns about the future of their jobs.

Meanwhile, the UK’s IT sector is being pushed to deliver more with less. Research backed by SOA infrastructure vendor Progress Software found that a higher proportion of IT departments in the UK have suffered budget cuts (52%) than in any other European country.

And UK IT departments also topped the charts for increasing expectations, with 91% of respondents saying they are being called on to deliver more than ever before.

“This is a tough time for IT,” remarks Dennis Allan, Progress Software’s EMEA VP.

That is affecting morale. Also published in August was research by recruiter Harvey Nash which found that the number of CIOs that found their jobs fulfilling was down to 74%, from 84% two years ago.

Little wonder, then, that senior IT managers are among the UK executives most likely to seek jobs abroad. A report from European recruitment website Experteer found

that the UK suffered a net executive talent loss of 8% in the past year, with finance and IT executives the most likely to move abroad.

This finding comes in spite of the fact that a skills shortage in the UK is forcing up IT sector pay, especially in middle management. And that shortage is unlikely to end any time soon – the number of students taking GCSEs and A-levels in IT-related subjects dropped by 50% in 2008.

But is the recession really to blame for IT executive emigration? Some argue that the move simply reflects the changing shape of European multinational organisations, which are moving their headquarters out of expensive destinations such as London to cheaper (and less taxing) locations such as Switzerland. That country was the largest net beneficiary of executive talent, the Experteer report found.

The experts' response

Torsten Muth, UK managing director at European career specialist Experteer, says IT is a field that lends itself to relocation

The recession is one of the main reasons that more UK IT executives are moving into Europe. Other countries have not been hit as badly as the UK yet, and people clearly believe there might be some better opportunities abroad. But people are also looking for a higher standard of living and a better work/life balance. It is easier than ever to move abroad, because we have all these different ways to keep in touch with our friends and family. And IT is one of the easiest sectors for relocating, because IT is a universal language, and doesn’t require the same amount of local knowledge as marketing and sales, for instance.

Bryan MacDonald, head of the UK CIO practice at executive search company Heidrick & Struggles, says the global executive movement is a fact of modern business

Talent mobility has been a major theme for global organisations for a number of years now. As companies look to simplify their business operations and reduce the complexity in IT, more and more are heading towards greater IT centralisation. Inevitably, this is causing IT staff to relocate to where the hub is. Banks and pharmaceutical companies have been at the forefront of this centralisation agenda. Therefore it is maybe not surprising to see Switzerland top the ‘talent import’ list, especially when you add that to the favourable economic conditions that exist there.