Tech unemployment rises to four-year high in June

Dive Overview:

• The unemployment rate for IT professionals reached 3.7% in June, up from 2.5% the previous month. CompTIA Review The unemployment rate rose to its highest level since August 2020, at 4.6%, according to data released Friday by the Bureau of Labor Statistics.
• Other key indicators of the tech labor market There were signs that demand was sluggish: Across the economy, tech jobs fell by 22,000, with job openings down slightly from the previous month.
• In contrast, companies in the high tech industry saw a net gain of 7,540 jobs last month, the largest monthly increase so far this year, according to CompTIA.

Dive Insights:

The gap between the national unemployment rate and the skilled unemployment rate was less than half a percentage point in June, a gap that has been narrowing gradually over the past four years.

A confluence of factors, including the rapid adoption of AI, is causing some employers to delay their hiring plans for technology roles, according to CompTIA chief research officer Tim Herbert.

“Recent data suggests that technology industry employment is experiencing some downward pressure,” Herbert said in a press release.

A similar shock occurred in February, IT unemployment rate rises to 3.5%At the time, CompTIA identified delays in reporting employment data as a contributing factor, especially as the year began with tens of thousands of job cuts in the technology industry.

Nick Bunker, director of North American economic research at Indeed’s Hiring Lab, said June’s increase came as the overall job market was showing clear signs of cooling.

As for what could be causing the June hiring surge, “it’s most likely due to weak demand for tech workers,” Bunker said in an email. “Tech workers who have lost their jobs are having a hard time finding new work.”

According to Bunker, the number of software development job postings on Indeed is down more than 30% compared to pre-pandemic levels.