In this article, we touch on some of the results in our latest, annual IT Staffing Benchmarking Survey. The survey provides in-depth visibility into the US IT staffing market by gathering data from the past two years on volume and rates by skill set and occupation. It also explores industry trends and practices including: VMS/MSP prominence, statement-of-work engagements and client vertical market demand.
The results serve as an important companion to other surveys produced by Staffing Industry Analysts to help clients benchmark their firms’ financial and operational performance relative to competitors. This includes the monthly Pulse Survey; semiannual Staffing Industry Benchmarking Consortium; and annual surveys issued broadly to staffing firms, large buyer organizations, and temporary workers themselves. One thing that makes this survey unique is its focus on the IT segment.
Building upon the momentum generated from the 2016 inaugural survey, the 2017 survey garnered an increase in participation, both in terms of revenue representation and in volume of responses. Specifically, the 2017 survey reflects more than $5.2 billion in 2016 IT temporary staffing revenue, generated by 22 participating staffing firms. Aggregate year-over-year revenue growth was 4.3%, roughly in-line with 4% market growth estimated in our US Staffing Industry Forecast Report. Among the 13 specific IT occupations provided as options, software developer/engineer/DevOps accounted for the largest portion of revenue captured by the survey, followed by project manager and business/systems analyst.
The occupations with the highest year-over-year revenue growth rate were web developer/digital/UI/UX, business/systems analyst and cyber/data security. Cyber/data security led all occupations in revenue growth in the prior year survey and continues to exhibit impressive demand. We expect this trend to continue as frequent news headlines, such as the recent worldwide cyberattack by the WannaCry ransomeware, drive global awareness to the vulnerability and strategic importance of cyber security. The only occupation that saw a revenue decline was software QA/testing, possibly due to pressure from automation and offshoring.
The effects of demand on supply were clearly visible when survey respondents were asked to rate recruiting difficulty for each occupation on a one to five scale, with five indicating extreme difficulty. For the second consecutive year, cyber/data security and cloud architect were rated highest for recruiting difficulty. These two occupations appear to have become even more challenging to fill as both received an average recruiting difficulty rating of 4.3, compared to each scoring 3.8 in the 2016 survey. At the opposite end of the spectrum, the occupations rated least difficult to recruit were help desk/PC support (1.6) and technical writer (1.7).
Average recruiting difficulty, 1-5 scale
Bill rates for many of the listed occupations fell within a fairly tight band. For example, median bill rates for seven of the 13 occupations fell within a range of $4 of one another. However, cloud architects commanded the highest median rate, by a significant margin. This reflects both the high degree of skill the occupation requires and the recruiting difficulty noted above.
The report also contains benchmarking on markup. Help desk/PC support produced the highest markup percentage. This likely reflects the margin necessary to cover fixed costs, which are proportionally greater on lower-wage occupations. The inverse of this dynamic holds true as cloud architect, the highest wage occupation listed, ranked among the lowest in markup. As cloud architects are in such high demand, staffing firms may in some cases not be passing through pay increases as quickly as bill rate increases, further contributing to a lower markup.
While the full report of results is available only to firms that completed the survey, corporate members can access the summary report, which presents some findings in addition to those covered in this article. If you would like to receive an invitation for your firm to participate in the 2018 survey, please send an email to Brian Wallins at bwallins@staffingindustry.com.
