Contrary to what you think, now is the time to study IT. Just make sure you are interested in the content of the field rather than its future trappings.
Lately, I have been reading stories in the newspapers about out-of-work Web designers, business plan writers and other specialists from the giddy times of dot com. These people are sipping fewer lattes and trying to find a taker for their BMWs -- if they ever got around to owning one. Not that I need to read about this in the newspaper -- there is a rather dramatic drop in the number of students taking IT classes as well. eBusiness courses are not the sure draws they used to be. Students, seeing the deflation of the dot com bubble, are reluctant to study something that turned out to be not nearly as rosy as they had hoped for -- and a topic that may turn out to be rather unglamorous and, to be quite frank about it, a tad rich in detail and numbers.
I think they are dead wrong. Now is the time to study IT -- both technical IT and business IT.
Most markets experience boom and bust cycles. A boom turns into a bubble when investors stop investing based on fundamentals, and start investing on expectations -- that is, they buy into the market because they expect prices to continue to rise, not because of the attributes of what they are acquiring. Anyone lured into the stock market over the last five years has learned this, in most cases at rather substantial personal cost.
The same phenomenon operates in the labor market, and none more so than in information technology. Specifically, many prospective workers, such as students, choose careers (i.e., make their investments) based on expectations of jobs and revenues, rather than on fundamentals, i.e., the content of the work itself. Since revenue projections are based on extrapolation, and delayed systems with imperfect feedback inevitably produce over- and undersupply, these students are likely to be disappointed when they graduate and find themselves competing with hordes of people who thought just like they did. Moreover, they will find themselves with knowledge and skills that have little intrinsic interest to them.
The current flameout in the technology field illustrates this nicely. Two to three years ago, students were signing up in droves for anything that had to do with the Internet and information technology. They were lured by the hockey-stick curves of Web adoption, ERP sales, mobile phone usage and wireless networks installations. As these fresh faces graduate from hundreds of "quick and comfortable" IS programs, they find a job market with no year 2000 crisis to suck in manpower, SAP largely up and running with few "achtungs", and a slope in demand for Macromedia jockeys and cookie-cutter business plan editors. They find themselves competing against seasoned technologists and managers who chose their profession because the work itself was interesting -- the people who have weathered hard times before. And the people who are truly leading in innovation are, ironically, largely working for free, on open source systems.
Contrarian investing: So much for the boom and bust
How to get out of this situation? Savvy investors know about the propensity for markets to overshoot, and adopt a number of strategies to exploit it. One is contrarian investing -- buying stocks in industries that currently are underperforming the market average, based on the theory that these stocks can be had cheaply and will grow faster than the market when the industry rebounds. The risk here is, of course, that the underperforming industry really is going down -- essentially disappearing because there is no longer a demand for the products or services it provides.
Drawing on this analogy, it seems to me that the smart career choice right now would be information technology, at least if you are a student thinking about which major to choose or a high school graduate thinking about which undergraduate program to pick. Since fewer students are choosing IT after the dot-com boom, and most programs take three to five years to finish, choosing IT as a career now is essentially the equivalent of contrarian investment. When you graduate in three to five years, you are entering a field where demand has rebounded, and the supply of students is much smaller than it is now. Low supply and increasing demand should equal high salaries and interesting jobs.
Now, if you chose IT, wouldn't you have to compete with the current crop of graduates, the ones who graduated right into the slump? I don't think so. Since many of the current students have chosen IT for the expected high rewards, they will be disappointed and seek other ways to fund their latte and sports car consumption. Most of them will find at least something that pays better. After a few years, the new, smaller crop of IT students hits the market. Since IT students are sought partly for their knowledge of the latest technologies (at least at the point of hire), they should be preferred over many of the current graduates, who will not have kept up on the technology.
Of course, there is the aforementioned risk that the current slump in the IT market is permanent -- that there will be less need for IT specialists in the next 10-20 years. I don't believe much in that either. While most societies have bought lots of technology, with home PC and mobile phone ownership in the high 70s, and most companies are unlikely to buy substantially more computers and networks than the "one for each employee" they tend to have now, there is still huge growth potential in embedded systems and all kinds of networking. These first-order effects, however, are dwarfed by the second (figuring out new ways of using the technology) and third (taking advantage of the effects of the new ways of using technology).
The world will continue to need IT people who chose the field for content rather than hype.
That being said, a little hype right now wouldn't be bad, either.
Espen Andersen (email@example.com) is associate professor with the Department of Strategy at the Norwegian School of Management BI ( www.bi.no), and a research affiliate and European research director with The Concours Group (www.concoursgroup.com), an international IT and management research and consulting organization. Based in Oslo, Norway, he has done research on topics such as mobile business, electronic commerce, knowledge management, digital business strategy and CIO-CEO interaction.