CIOs are showing signs of optimism as they look towards the New Year, predicting a modest a net increase in hiring, a survey from Robert Half Technology has found.

Caution is still the operative word for most CIOs, as the vast majority is struggling with flat or constrained budgets. Robert Half found that 89% of CIOs say they plan to maintain current staffing levels.

However, the survey also found that 7% of technology executives now anticipate hiring IT staff in the first quarter of 2010, while 4% plan reductions. The net 3% increase is the strongest hiring activity since the first quarter of 2009.

“After months of slow hiring activity, managers are beginning the year with new budgets and appear ready to carefully expand their IT departments,” David Willmer, executive director of Robert Half, said in releasing the survey. “Many firms are investing in technologies that improve efficiency and competitiveness, and there has been demand for additional professionals to implement these projects.

“The health services sector, for instance, needs IT talent to manage the conversion to electronic medical records,” he added.

Robert Half conducted more than 1,400 telephone interviews with CIOs from companies with more than 100 employees to produce the quarterly IT Hiring Index and Skills Report.

When asked to rate how confident they are in their company’s likelihood to invest in IT projects in the first quarter, on a scale of one to five (one being the least confident), 42% of CIOs gave responses of four or five. Of that group, 23% rate their confident level at a five.

In terms of skills in demand, CIOs reported that the most challenging area to find skilled IT workers was networking, followed by security and applications development.

The following are other key findings from the report:

• The East North Central and South Atlantic states expect to see the greatest hiring activity with 8% of CIOs in each region anticipating a net hiring increase. Those in the East North Central region note a particular need for network administration and desktop support skills, while those in the South Atlantic region are seeking application, Web and database development skills.

• The wholesale, retail and health services sectors are showing the strongest IT hiring activity. The wholesale sector was strongest with 20% of CIOs expecting to add staff, followed by health services at 16%, and retail at 10%.

• Among those adding staff, 58% of CIOs said they will recruit full-time employees, while 28% were planning a mix of full-time and contract workers.

This story has been reprinted with permission from Information Management.

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