Banking

Latest financial meltdown may create IT jobs

As we learned from the Enron scandal, mandated accounting regulations often create IT jobs.Will that be the case with the latest financial crisis?

As we learned from the Enron scandal, mandated accounting regulations often create IT jobs. Will that be the case with the latest financial crisis?

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No one really knows in what ways the recent financial crisis will affect the world of IT. Some experts are already predicting how some technology initiatives will be affected -- you'll likely see a stall in the implementation of new enterprise mobile apps, and there could be a pricing war in the SaaS (Software as a Service) arena -- but in a silver lining kind of way, IT jobs may increase in some areas.

We're all familiar with the regulations that came about due to the Enron financial scandal (Sarbanes-Oxley and that ilk). Some experts are predicting that there will be a slew of new regulations meant to curtail fancy lending practices of financial institutions. And is often the case with regulations, it will fall to IT to enforce them through technology systems.

In other words, the country is clamoring for a new wave of compliance, and IT pros are the only folks who can make it happen. Now, of course, this is both good news and bad news. Good news is the job opportunities that will arise, but bad for the people who loathed implementing Sarbanes-Oxley safeguards with every inch of their being.

And, according to InfoWorld, the new rounds of regulations resulting from the convoluted lending practices will be much more complex than Sarbanes-Oxley.

As these financial instruments were repackaged and resold, investors lost the ability to track what exactly was in each offering and what the actual risk was; even those trading in such instruments weren't exactly sure what they were selling or buying. To prevent a recurrence of such murky instruments will require transparency in how companies and what they trade are linked together. That in turn requires increased use of auditing and tracking applications and the business processes behind them.

About

Toni Bowers is Managing Editor of TechRepublic and is the award-winning blogger of the Career Management blog. She has edited newsletters, books, and web sites pertaining to software, IT career, and IT management issues.

12 comments
Slamlander
Slamlander

Universally, on CNBC anyways, it is thought that the only remedy is to build a Central Exchange. Possibly, an exchange per country. It is the only way to track these things. In that case, you only need to build and maintain one per country and, in the US, it will probably be under DOC or Treasury license and they will do all the regulatory enforcement there. The problem is that the secondary market is a B2B process and there was no way to track those things. It requires a systemic approach and a central clearing house, like the stock exchange, is the only way to deal with it. Internal IT department simply do not have access to all the data because half the data is in another company. I don't see it generating industry-wide work, like SOX did.

kkorf
kkorf

It was not so long ago for the Sarbanes-Oxley regulations. I don't know about the rest of you; but for me the implementation of the Sarbanes-Oxley, is pretty much non- existent. Management still refuses to purchase the necessary equipment, storage, etc to comply with the Sarbanes-Oxley regulations. What makes any of us believe that new tougher regulations will meet with the anticipation of the costs involved for implementation? I know it is difficult now, just to get enough money to replace parts, let alone anything new. My question is, how will the government enforce new regulations, when they can't even enforce the regulations they have now? P.S. I like the guns for Vista comment... Great Point

reisen55
reisen55

Companies are in financial trouble and the option of hiring qualified experienced but expensive (moderately so) AMERICAN IT professionals is always balanced against the siren song of Bangalore where you can get armies of recent college grads, all earnestly eager to help you, for 1/4 salary and no health care benefits at all. For brain dead American management - lotsa that around - this decision is all to often a no-brainer too. Notice the word "quality" is always left out of the outsourcing equation though. I wonder why?

knev_15
knev_15

If no one funding to any new projects where does the growth happens ? IF funding happens all new invensions , jobs and economy can come up.

ITforTheMasses
ITforTheMasses

Growth, with respect to this article, will exist because financial firms will be forced to adhere to new government regulation. Companies will have no choice but to fund these types of projects. On the other hand, new technology innovations will certainly decrease, or at least they won't get off of the ground, because VC's etc. are currently too spooked to part with their cash.

imsrinivas
imsrinivas

The regulation implementation will definitely reduce the job cuts by retaining IT personnel in the financial institutions. I am not sure if there would be a raise of jobs for now.

Tony Hopkinson
Tony Hopkinson

My own employer is doing very well. I still get job hits from the financial sector. Certain sectors are bound to get hit, but good IT has always been an enabler for reducing costs. I suspect we'll see a lot more formal acceptance of IT generalists. DBA's who can do a bit of system admin, Programmers who can be DBAs, techs who can manage a bit etc.

santeewelding
santeewelding

Law enforcement. Given this bunch, it ought to be interesting.

Ed Woychowsky
Ed Woychowsky

Issuing guns to IT people, a sure way to fix Vista's problems. :)

MinJRB
MinJRB

Are the guns to shoot the PCs with Vista or to shoot the PEBCAK errors?

1PatD
1PatD

I agree wholeheartedly with this article, as it is a reflection of transition in IT. I found using communications tools have filled the need in the transit and saving loads of money during the process. I used http://try.nefsis.com, which really made a huge productivity difference, while controlling funds, creating a superior IT management experience. Thought I would share.

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