Software Saviors

But there are less somber although not very comforting predictions from a group of experts at the Stanford Computer Industry Project: The shortage will provoke a slowdown in the maintenance of a multitude of products and in the introduction of new goods and services (competitive advantages U.S. industry has enjoyed in global markets until now), and industries and government alike will have to go through massive adjustments.

None of this, unfortunately, falls into the realm of science fiction. If there has been some millennial doomsday hype around, the shortage of software workers is a fact that has been aggravated by a huge temporary demand caused by the year 2000 problem. There are nearly 190,000 software positions unfilled today in the United States. According to the Stanford study, many companies will be hurt soon. “Business thinking about software will undergo radical change in the next few years. Some companies may go out of business simply because their competitors adjusted better to the labor conditions,” warn Avron Barr and Shirley Tessler, software company consultants, and William Miller, a professor at the Graduate School of Business and director of the Stanford Computer Industry Project.

Companies whose main product is software are already reacting to the labor crunch. Like major league baseball team owners, they are offering seven-figure signing bonuses, stock options and higher salaries to lure the most talented programmers, managers and engineers. “We predict that salaries for good software people will ramp up rapidly in coming months, causing people to change jobs more frequently, which in turn will cause project delays as replacements take longer to find,” the researchers wrote in their report. Those likely to be hardest hit are government agencies, information systems departments of low-tech industries and non-profit organizations, which are least able to attract and maintain top computer software talent.

Even companies that don’t seem vulnerable are affected. “Companies like Citibank and General Motors don’t appear to be in the business of making software, yet the products and services they sell are increasingly computer reliant,” Barr said. “They haven’t seen software development and maintenance as one of their core competencies,” Tessler added.

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