Reclassification Is Making US Tech Job Losses Look Worse Than They Are

According to consultancy firm Janco, the U.S. Bureau of Labor Statistics reclassified several job titles, 'leading to a downward adjustment of over 111,000 positions for November and December 2024,' The Register reports. This revision contributed to an overall decline of 123,000 IT jobs for the year. However, in reality, IT sector hiring is on the rise, with 11,000 new positions added in January. From the report: 'Many CEOs have given CFOs and CIOs the green light to hire IT Pros,' Janco CEO Victor Janulaitis said of the first month of 2025. 'IT Pros who were unemployed last month found jobs more quickly than was anticipated as CIOs rushed to fill open positions.' There's still a 5.7 percent unemployment rate in the IT sector in January, Janco noted, which is greater than the national average of 4 percent - and which could rise further as Elon Musk's Department of Government Efficiency (DOGE) pushes ahead with federal workforce reductions aimed at streamlining operations.

'Over the past several quarters much of the overall job growth was in the government sectors of the economy,' Janulaitis said. 'With the new administration that will in all probability not be the case in the future. 'The impact of the DOGE initiatives has not been felt as of yet,' Janulaitis added. 'Economic uncertainty continues to hurt overall IT hiring.' Despite this, Janco reported an addition of 11,000 new IT roles in January. Unfortunately, there's also been a surge in IT unemployment over the same period, with the number of jobless IT pros rising to 152,000 in January - an increase of 54,000 in a single month.

Closing out the report, Janco offered a mixed outlook: While IT jobs are expected to grow over the next few years, many white-collar roles could be eliminated. 'Over the next five years, the number of individuals employed as IT professionals will increase while many white-collar jobs in the function will be eliminated with the application of AI and LLM to IT,' Janco predicted.

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