Tech Job Update

According to a recent survey by tech trade group AeA, approximately 234,000 high tech jobs were lost in 2003, building on the loss of 540,000 jobs in 2002.

Although it appears that the bear market for tech stocks has finally come to an end and corporate tech spending is set to increase, industry observers say that there probably won't be major improvement on the job front in 2004.

Of course, the trend toward outsourcing continues to accelerate. The latest example was a report Monday that IBM (IBM: Research, Estimates) was planning to ship more than 4,700 programming jobs overseas by early next year. "I don't see any reason why tech outsourcing will come to an end since businesses can reap enormous cost savings," said Mark Zandi of Economy.com.

And tech companies have come to enjoy the higher profit margins that come with a lean work force. Job cuts made during the past few years helped boost results this year as more revenue flowed to the bottomline due to lower labor costs.

But there will probably be continued job cuts in the telecom sector next year, particularly telecom services, as this group remains in a major slump. In the past few weeks, long distance providers Sprint (FON: Research, Estimates) and AT&T (T: Research, Estimates) and local phone giant SBC Communications (SBC: Research, Estimates) have all announced more layoffs.

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