IRS Reducing Size Of Cybersecurity Staff

The Internal Revenue Service, which confirmed rumors of a breach of 100,000 taxpayer accounts, has been consistently reducing the size of its internal cybersecurity staff as it increases its security spending. This may seem paradoxical, but one observer suggested it could signal a shift to outsourcing.

In 2011, the IRS employed 410 people in its cybersecurity organization, but by 2014 the headcount had fallen by 11% to 363 people, according to annual reports about IRS information technology spending by the U.S. Treasury Department Inspector General.

Despite this staff reduction, the IRS has increased spending in its cybersecurity organization. In 2012, the IRS earmarked $129 million for cybersecurity, which rose to $141.5 million last year, an increase of approximately 9.7%.

This increase in spending, coupled with the reduction in headcount, is an indicator of outsourcing, said Alan Paller, director of research at the SANS Institute. Paller sees risks in that strategy.

“Each organization moves at a different pace toward a point at which they have outsourced so much that the insiders do little more than manage contracts, and lose their technical expertise and ability to manage technical contractors effectively,” said Paller.

An IRS spokesman was not able to immediately answer questions about the IRS’s cybersecurity spending.

This breach is drawing congressional scrutiny. On Tuesday, U.S. Senator Orrin Hatch (R-Utah), who heads the Senate Finance Committee, called the breach “unacceptable.”

The IRS’s total IT budget in 2014 was $2.5 billion, an increase from the prior year’s $2.3 billion, with 7,339 employees last year, little change from 7,303 reported in 2013.

The agency’s IT budget has fared better than the agency overall. Congress has been cutting spending at the agency. IRS funding has been reduced by $1.2 billion over the last five years, from $12.1 billion in 2010 to $10.9 billion this year. An IRS official told lawmakers earlier this year that the budget cuts have delayed critical IT investments of more than $200 million, which includes replacing aging IT systems.

Source

Is The Tech Industry Going Independent?

The tech industry is undergoing a shift toward a more independent, contingent IT workforce. And while that trend might not be cause for alarm for retiring baby boomer IT professionals, it could mean younger and mid-career workers need to prepare to make a living solo.

About 18% of all IT workers today are self-employed, according to an analysis by Emergent Research, a firm focused on small businesses trends. This independent IT workforce is growing at the rate of about 7% per year, which is faster than the overall growth rate for independent workers generally, at 5.5%.

The definition of independent workers covers people who work at least 15 hours a week.

Steve King, a partner at Emergent, said the growth in independent workers is being driven by companies that want to stay ahead of change, and can bring in workers with the right skills. “In today’s world, change is happening so quickly that everyone is trying to figure out how to be more flexible and agile, cut fixed costs and move to variable costs,” said King. “Unfortunately, people are viewed as a fixed cost.”

King worked with MBO Partners to produce a recent study that estimated the entire independent worker headcount in the U.S., for all occupations, at 17.7 million. They also estimate that around one million of them are IT professionals.

A separate analysis by research firm Computer Economics finds a similar trend. Over the last two years, there has been a spike in the use of contract labor among large IT organizations — firms with IT operational budgets of more than $20 million, according to John Longwell, vice president of research at Computer Economics.

This year, contract workers make up 15% of a typical large organization’s IT staff at the median. This is up from a median of just 6% in 2011, said Longwell. The last time there was a similar increase in contract workers was in 1998, during the dot.com boom and the run-up to Y2K remediation efforts. Computer Economics recently published a research brief on the topic.

“The difference now is that use of contract or temporary workers is not being driven by a boom, but rather by a reluctance to hire permanent workers as the economy improves,” Longwell said.

Computer Economics expects large IT organizations to step up hiring in 2014, which may cause the percentage of contract workers to decline back to a more normal 10% level. But, Longwell cautioned, it’s not clear whether that new hiring will be involve full-time employees or even more contract labor.

Source