The iSeries 2006 Job Market, Part 2: What’s in Store?

Last week, I established that, according to the nine end-user shops and the five software vendors I polled, iSeries shops do not seem to be hiring, but ISVs are. That generalization holds true for both IT staff in general and specifically for iSeries professionals. But what is happening in the IT market at large, and what factors will really affect hiring in iSeries shops in the coming years? That’s what I set out to find out.

Well, to start, the optimists are having a field day, predicting a much-desired upswing in hiring for the technology sector. You have to take such predictions with a grain of salt. How many times have we heard that there would be an upswing in IT spending during the second half of the year? Lots. How many times did it happen? Not once. But IT spending is only loosely coupled to IT hiring, so you cannot take the analogy too far.

Robert Half Technology reports that 13 percent of CIOs plan to add full-time IT staff this year, compared with just 9 percent a year ago. RHT also predicts that the finance, insurance, and real estate industries will lead the way in IT hiring, and that Microsoft Windows administration will be the skill set most in demand.

In a recent College Journal column at The Wall Street Journal, college students were advised to focus on three industries: health care, biosciences, and technology, predicting that hiring in “computer systems design and related services companies will increase 6.8 percent in 2006.” The hottest job prospects, they say, will be for “product managers and consultants familiar with enterprise resource planning (ERP) applications.”

And Business Week Online, in a January 23 article entitled “They’re Hiring in Techland”, carries the subtitle, “The tech job market has spring back to life, and this year could be the best one since 2000.” The article goes on to quote Mark Zandi, chief economist of Economy.com: “As the memory of the tech bust fades, we seem to be getting better and better job growth.” The article concludes that, while the pace of hiring will not match up to that of the late 1990s, “the industry appears to be reaching a steady pace of creating an average of 150,000 jobs a year. Over the next five years, Zandi forecasts that tech will create 782,000 jobs, or 8.6 percent of the economy’s projected 9.1 million new jobs.”

The only dissenter in this wave of positive thinking is Victor Janulitas, president of Janco Associates, who believes that hiring is not really up much overall. “We’ve lost about 10 percent of the workforce,” he observes, pointing out that “IT is now viewed as a cost/service center in most enterprises. It’s also at a disadvantage because in the past, IT has been paid higher than most of the rest of the workforce. At the same time, a move to outsourcing is pushing salaries down. Finally, there’s no new, exciting technology that everyone has to have.”

Still, if these are a valid sample of data points, the IT hiring picture looks pretty good. You might even be optimistic enough to once again encourage that niece or nephew of yours to go ahead and major in computer science. But most of these widespread studies are done on large businesses. Do these results transfer to small and medium businesses in general and to iSeries shops in particular?

Nate Viall, president of iSeries recruiting firm Nate Viall & Associates, cautions that, “Almost without exception, people are being very careful in hiring. The pain of the recession is still here, and recent enough in spite of the trend line. We’re still remembering when it went down, though I am hearing cautiousness about hiring in about one-third of the iSeries sites.” Still, Viall believes that we are “back in balance” from the bust years. “Companies are now going back to college campuses and hiring entry-level people,” and that’s something we haven’t seen in recent years.

But that doesn’t mean that iSeries folks–either those who work on the iSeries or those who hire iSeries professionals–can sit back and relax, assuming that there are plenty of jobs and ample candidates to go around. The world is changing.

“Most companies don’t fathom what’s coming at them in the job market–the retirement of the Boomers,” explains Viall. “In the iSeries world, the percentage of people with 25 years or more of experience has more than doubled in the last few years. It’s very alarming.”

Those who manage iSeries shops agree that the increasing age of the iSeries workforce is a concern for several reasons. John Matelski, chief security officer and deputy chief information officer for the city of Orlando, Florida, notes that the pool of iSeries people available to the city “typically has 10 or more years of experience, which is a good thing; however, because of that extensive experience and unique skillset, the marketplace dictates that they receive a salary outside the range of our public sector budget. With this in mind, and recognizing that this would provide a promotional opportunity to a member of our current staff, we chose to promote from within.”

In fact, Matelski says that the city has a few people internally who have expressed an interest and willingness to work on the iSeries. These people realize, he observes, that this would broaden their knowledge base and let them expand into an area where there is less competition and the potential for higher salaries.

An iSeries programmer from one end-user shop, who wishes to remain anonymous, comments that at his local user group meetings, there are not many young faces. “I suspect that we are typical of a lot of companies in that we hire experienced people, have very low turnover, and have a mature staff. Good things for a time.” But the positives of having a mature workforce (even if they are expensive) might quickly come to an end once the Boomers begin to cash in their retirement chips.

The PowerTech Group‘s chief technology officer, John Earl, reports that the average age of its iSeries staff is about 50, and some of these people are beginning to think about retirement.

Peggy Dunn, director of information technology for Puget Sound Blood Center is also concerned. She’s not yet ready to consider moving off of the iSeries because of the difficulty in hiring qualified staff. “If it continues to be this difficult, it might have to be a consideration within the next five to 10 years,” she says. “I expect my iSeries staff to begin retiring in about eight to 10 years, and if there aren’t any options for succession planning, we would have to consider switching to another platform. I’d like to see more young people attracted to the platform so the hiring outlook would improve. It’s somewhat of a Catch-22, though, because the iSeries staff currently employed are staying put, which doesn’t allow for any opportunities for younger staff.”

The vice president of marketing at an ISV, who wishes to remain anonymous as well, points out an additional problem caused by the aging of the iSeries workforce: “It’s difficult to build a team of iSeries people. There seem to be a lot of chiefs and very few Indians.” The average age of this ISV’s staff is in the high 30s (and that’s low for some iSeries shops), and some people have 25-plus years of experience. “They all want to be paid for those years of experience and want management positions. They don’t want to be maintenance programmers.”

“Back in the days of the System/36,” he recalls, “you could find people who could really get their arms around the whole box. Then with the introduction of the AS/400, you began to see splintering. Now we have storage experts and network experts and programmers, but very few people who understand the whole thing.”

It seems clear that there are jobs available in the iSeries space, but the nature of those jobs is changing and candidates had better be prepared with updated skills. This is especially true if they are applying for a job with one of the ISVs, most of whom today support more than one operating system, if not more than one hardware platform.

Pete Elliot, director of marketing for Key Information Systems recalls the time when the company used to get job candidates who had iSeries skills and they would then pick up Linux, Unix, and Windows. Now, it’s the other way around. Younger people come in knowing the other platforms and they bring them up to speed on the iSeries. “Requirements for support in corporate environments with the iSeries have vastly changed over the past ten years,” says Elliot. “The iSeries is a great platform. We all know that. But now iSeries people must at least know the impact of different operating systems in and on and around OS/400. Hardware and software integration issues are more critical then ever to its longevity. The more technicians and people hired to support the iSeries can bring the iSeries into the mainstream and integrate with other technologies, the more iSeries will additionally find its place in the corporate environment and underscore its ROI for companies.”

“Unless iSeries programmers are getting the new skills at their current shops, they should be taking on initiative to learn other, non-traditional iSeries language skills or they will become less attractive to innovative vendors and IT shops,” suggests Bytware president, Christine Grant. “IBM’s consolidation direction, the increased demand for graphical and Web-based technology, and multi-platform integration are all placing a greater demand on iSeries skills expansion.

It seems clear, then, that the iSeries folks who are staring down retirement might well be able to afford to hang on with their RPG and green screens skills. But clearly, that’s not going to cut it with those moving into the iSeries space today. The newcomers might come from a variety of platforms and the iSeries might just be one more place to park their Linux, Java, or .NET skills. And to them, it probably won’t matter much what the box is.

This might bode well for the future of the iSeries–that it becomes a box that holds and lives with the most current and fashionable of the operating systems among us. But I hold out little hope for OS/400 and i5/OS as a growth platform over the long haul (see the previous articles from 2005 in The Four Hundred on the OS/400 ecosystem).

Meanwhile, what is IBM doing to “sell” the iSeries platform to up and coming IT professionals? Precious little, it seems. It is interesting to note that few of the people (from either ISVs or end-user shops) with whom I spoke were even aware of the IBM Scholars iSeries Program (formerly known as the Partners in Education, or PIE, program). And only one had ever hired anyone from that program. In fact, one ISV who had previously been an active participant in PIE thought it was “now defunct.” Another ISV described the program as “no longer active.”

Education is an area where IBM needs to increase its efforts, and while IBM has committed to adding many tens of thousands of iSeries newbies to the base, a surprisingly large number of these people are going to be working in India and China. As many iSeries employers have noted, new hires, and even in-house trainees, often balk at working on what they view as legacy technology. We’ve all heard so much about the marketing program. But shouldn’t getting the name of the iSeries in front of the younger workforce be part of that program?

In summary, then, the good news is that iSeries folks are still in demand–if they’ve updated their skills. The ISVs are planning a banner year. And although the end users, who don’t have many plans on the drawing boards for 2006, are holding steady, at least one prophet believes they’ll be next to open the hiring doors. Viall predicts “with cocky assurance,” that ISVs always lead in hiring and that the OS/400 shops will be right behind.

If so, then maybe there are good times ahead.