Petroleum, manufacturing and telecommunications are bright spots

March 2009

Dallas has been hit with a slew of layoffs in both the technology sector and the wider job market. The Texas Workforce Commission says chip-maker Texas Instruments plans to eliminate about 1,000 jobs, while Sprint Nextel will shed about 200. AT&T, Sun Microsystems and STMicroelectronics all intend to cut jobs in the area. On Dice, job postings for the Dallas have dropped considerably over the last 12 months: In February 2009, 1,780 IT jobs were listed on the site, compared to 3,328 a year earlier.

But some recruiters see pockets of demand for IT workers. William C. Howe, regional manager at Sapphire Technologies' Dallas office, has clients in the utilities industry that are looking to hire permanent IT workers, particularly those with SAP expertise. Firms in the petroleum industry are seeking IT contractors. "Contract labor or contract-to-permanent (have become) popular vehicles," says Howe. "I see a lot of demand for SAP skills in Dallas. SAP has a strong niche in the manufacturing sector."

Another bright spot is the telecommunications sector. "Telecommunication providers have been a bright spot, but people don't know why," Howe observes. "We've been seeing a better forecast in this area. There's a demand for programmers, some business analysts, and people who can manage telecommunications projects."

While demand for direct placements has fallen off "sharply," Howe says the use of contract workers, which previously focused on help desk and desktop support, is creeping up the food chain to include project managers and business analysts.

Steve Young, a senior IT recruiter for Manpower Professionals in Dallas, believes the overall market is dealing with the same challenges as the rest of the country. He's seen contraction in the sector as companies put major projects on hold or cancelled them altogether.

But, like Howe, Young sees some pockets of activity. There's a demand for business analysts and project managers at lower levels, with some opportunities in direct hiring but also contract work. There hasn't been a decline in technical support jobs, although most work is going to long-term contractors. "To some degree," Young says, "we are seeing more evaluating going on. From a business standpoint, these positions have to be directly related to revenue generation."

John Reed, district president of Robert Half Technology, also sees companies hiring more IT contract workers in an attempt to manage fixed overhead. In addition, his clients are putting in more job requests that merge several roles, such as a person who can do quality assurance testing, application programming and technical documentation writing. As more government roles are created via the federal stimulus package, he expects to see more demand for workers with security clearances.

Another strong area in Dallas is healthcare, where Reed sees strong demand for both permanent employees and contractors. Specifically, there's a need for IT workers with a specialized knowledge in healthcare-related technology, such as electronic management of patients¿ records.

But top-end projects are being curtailed.

"What I have seen are the more high-tech companies developing software and high-system integration, those are the projects that companies are putting on hold. We have seen (hiring for these jobs) subside somewhat," says Reed.

The state of Texas could lose about 300,000 jobs this year, about 100,000 more than previously forecast, according to the Federal Reserve Bank in Dallas. Federal economist Keith Phillips says that translates to an 8 percent unemployment rate. University of North Texas economist Dr. Bernard Weinstein notes something of an upside: Unlike most of the country, the Texas and Dallas areas had job gains in 2008. They didn't start losing jobs until November and December.