The latest Hudson report, which surveyed 8693 employers, found 37.5 percent are planning to increase permanent staffing levels during the March 2006 quarter. Only a mere 7 percent expected to decrease staffing levels during that period.
Hudson's Australia/New Zealand chief executive officer, Anne Hatton, said the tight Australian labor market is continuing to put upward pressure on wages.
Put simply, demand for Australian IT workers has never been better, according to recruitment consultants, who say upcoming projects in telecommunications and the banking and finance space are feeding the demand.
For example, Ericsson will begin work on Telstra's 3G/WCDMA network with Alcatel providing the telco's US$3.5 billion IP (Internet Protocol) network.
Some analysts are even suggesting the favorable conditions could entice students back to IT courses at Australian universities where enrolments have plummeted since 2001.
At the University of New South Wales enrolments have declined from 500 a year to 160 during this period while Monash University's Faculty of Information Technology has reported a 25 percent drop.
Peter Bateson, Robert Walters IT consultant, said compared to this time last year, conditions for Australian IT professionals have never looked better. "The space has been a little slow, but there are a number of large organizations in the teleco space looking hard for IT workers, and IT security professionals are in high demand for 2006," Bateson said.
"Salaries for IT workers will definitely increase this year, and our clients are realizing they have more jobs available and need to recruit."
Due to the demand, Bateson said, clients are willing to pay more for potential candidates.
Ken Owiti, principal of recruitment firm Hamilton James, said many large projects are being tackled in the enterprise, which is creating a positive environment for both permanent staff and contractors.
He believes many permanent staff will be looking to move into a contracting role this year to exploit the demand and dollars to be made.
"It is going to be interesting for IT workers in 2006," Owiti said, because big projects will rise more than is normal for the IT industry as a result of banks and telcos approving large development projects.
"Most of last year Telstra was holding back its restructuring and now it needs to get work done which will cause a flow-on effect across vendors as well as contractors; the banks will be looking for IT implementation and testing staff," Owiti said.
"I expect this will cause two things to flow on. Either companies will increase the salaries of staff to keep them on or those staff will become contractors. We will see a lot more skilled employees turn to contracting to maximize the pay and permanent IT staff will start heading in this direction too."