The E.L. Consult Executive Demand Index, which measures demand for executives across Australia, registered an 18 percent increase in executive demand in February relative to January. Demand for information technology executives rose by 46 percent over the same period.
"Although it's a fabulous result, demand has been far lower than replacement level for businesses to maintain their current IT investments," said Montgomery. "Indications are that managers are just catching up after over cutting in this sector." Despite the dramatic month-on-month increase, the demand is still more than 11 percent lower than February 2002.
Montgomery told ZDNet Australia E.L. Consult didn't expect a significant positive trend until the third quarter of this year. "Provided all extraneous things are taken care of, and things like [a potential war with Iraq and North Korea] don't change the landscape," he added.
In September last year the industry became excited when IT executive demand increased 52 percent over August, only to have demand fall by 37 percent in October and a further 9.8 percent in November. Demand then plummeted 48 percent in January compared to December.
"With the Index now having lost so much ground over the past two years, it should be remembered that even minor changes to the demand level all translate into significant percentage changes," read the report.
"It is now a good time to buy good IT assets but it will need a few more months of consistent rises before this becomes and obvious trend underpinning the general E.L. Index," said Montgomery.
New South Wales and Western Australia were the main positive forces for the IT Executive Demand Index, with the NSW State Election credited for part of the strong performance. Overall, both public and private sectors registered gains during the month.
