What Drives the Vacancy Rate for Information Technology Workers?

This paper provides empirical evidence on both the magnitude and determinants of unfilled vacancies for information technology workers using cross-sectional data for 4150 German firms. Vacancies are defined as unfilled vacancies excluding vacancies created by replacement needs during the first half year of 2000. The share of unfilled vacancies created by replacement needs is only about 20 percent indicating that high turnover rates are not the main reason for high vacancy rates. The adjusted job vacancy rate for ICT workers varies between 5.7 in the ICT sector and 6.7 in the non-ICT sector. Using generalized tobit models, I find the adjusted vacancy rate mainly depends on firm size, the share of ICT workers and actions taken to solve the ICT worker shortage in the past but not by the diffusion of ICT. In the ICT sector, the decision to train apprentices in the new ICT occupations in the past two years of the survey tends to reduce the current vacancy rate. In the non-ICT sector a successful strategy to solve the ICT worker shortage appears to be increased internal training. Finally, in the non-ICT sector the common practice to completely outsource software programming significantly reduces the probability of unfilled vacancies.

Falk, Martin (2001), What Drives the Vacancy Rate for Information Technology Workers?, ZEW Discussion Paper No. 01-43, Mannheim.