News

Report: 150,000 U.S. software jobs lost last year

• By Rich Seeley
• December 2, 2003

The U.S. software industry lost 150,000 jobs last year, according to the Cyberstates 2003 report released last week by the American Electronics Association (AeA). In the seven years that AeA has published its report on jobs, 2002 was the first year the software sector lost jobs. In fact, it had posted the largest gains of any high-tech sector to that point. A new trend now seems to be at work, one that programmers can only view with alarm.

If there is a bright spot in the report, it is a lessening of job losses in the software services category, which includes software publishers, custom computer programming services, computer system design and computer facilities management.

''Software services employment fell by 146,000 jobs between 2001 and 2002, compared to 2002 to 2003 where that number dropped 30,000,'' said Michaela Platzer, AeA vice president of research.

In the overall high-tech industry, AeA reported that its preliminary data for 2003 indicates that ''the decline in high-tech employment slowed considerably.'' Another potential bright spot was high-tech R&D, which posted a gain of 7,000 jobs in 2002, according to the AeA report.

''Hopefully, we've turned the corner,'' Platzer said.

Asked what has been causing the loss of high-tech jobs in general and software services jobs in particular, Platzer said more than one economic factor is involved; she argues that it is simplistic to blame it all on offshore outsourcing.

''I think there are multiple factors,'' she said. ''I think it is convenient to come up with one simple statement as to what's happening: 'Jobs are all going overseas.' That seems to be the conventional wisdom at the moment. But I believe it is much more complex than that and that it is a function of several factors.''

Among the additional factors, Platzer sees the reluctance of companies to hire in what has been a difficult economy coupled with productivity gains, which make it possible for employers to do more with fewer workers.

However, she agrees with other researchers and analysts in this area that no one has hard data on the specifics of where jobs are going and what other factors contribute to the sour employment market in software and high tech.

''Nobody really has the answer,'' Platzer said.

More information on the AeA Cyberstates 2003 report is available at http://www.aeanet.org.

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