Tech spending sparks hiring

Technology and telecommunications firms are hiring again after a long slumber.

More spending by companies on computer hardware and software and more investment by venture capital firms are leading big and small employers to add the most significant number of workers in years.

“We are definitely in a hiring mode,” said Jeff Shuman, vice president for human resources at Northrop Grumman IT, the Herndon-based technology division of the massive defense contractor.

Mr. Shuman said the technology division plans to hire 4,500 people this year to bolster the division’s current work force of 9,000.

Rampant spending by the federal government and private-sector firms on technology projects is fueling the hiring frenzy.

Federal agencies and private companies will spend a combined $770 billion this year on information-technology projects, up from $740 billion last year, Forrester Research reports. Some are buying computers. Some are buying software to provide online education courses or to comply with new federal auditing rules.

“With corporate profits up, there is more cash available for projects. [Companies] say they’re going to spend, and that makes sense in light of the strengthening economy,” Forrester Vice President Andrew Bartels said.

With greater demand for technology goods and services, technology and telecommunications companies are adding workers.

The number of jobs at tech companies, including computer makers, software developers and semiconductor manufacturers, has declined 11.2 percent to 4.8 million since 2000. Jobs in the rest of the private sector have declined 2 percent in the same period.

Tech companies added 1.8 million jobs from 1993 to 2000, but they have shed about 600,000 positions since then, the Commerce Department reported in December.

Technology firms slashed workers in 2001 and halted hiring in 2002 and 2003, but “this year it’s a very different story,” said Paul Villella, president and chief executive of HireStrategy Inc., an executive recruiter in Reston.

“Businesses are buying computers, products and services so tech companies are hiring to keep up” with demand, he said.

Northrop Grumman’s technology division will add legions of workers, but most companies are hiring a few.

Bryan Ware, president and chief executive of Reston software developer Digital Sandbox Inc., said his firm will add at least 12 employees this year, increasing the work force to 32.

“For us, that’s pretty significant,” he said. “It’s only recently that we’ve needed a lot of people, but business is growing extremely fast.”

Software developer Approva Corp., based in Vienna, Va., has doubled employment since Dec. 31 by adding 40 workers.

Approva’s software helps companies comply with federal auditing requirements outlined by the Sarbanes-Oxley Act.

The company plans to add about 20 workers by the end of the year, Approva chief marketing officer Neil Selvin said.

The metropolitan Washington area is adding jobs as fast as any other region in the nation, said Scot Melland, president of the online recruiting firm Dice Inc., based in New York.

Washington “is definitely in a recovery,” Mr. Melland said.

But it is not clear how long companies will continue hiring, Mr. Bartels said.

“This is an upward trend in hiring, but it’s not a boom,” he said.

“This is an upward trend in hiring, but it’s not a boom,” — Scot Melland, president of online recruiting firm Dice Inc.

Paul Sparta, chairman and chief executive at Arlington software firm Plateau Systems Ltd., said his company receives three calls a week from potential investors.

Access to funding “is fantastic right now,” he said.

So is access to human capital, but the deep labor pool is a greater advantage for companies than workers.

“It’s a buyer’s market. For companies that are hiring, it’s a great time because there are great people out there,” said Scott Wharton, vice president of marketing at Broadsoft Inc., a Gaithersburg company that develops software to support Internet telephone service.

Northrop Grumman’s technology division receives up to 60,000 resumes a month from people hungry for work.

“We’re able to be selective,” Mr. Shuman said.