After a tough year in the IT sector, expect some churn in early 2010. That's the word from the recruiters looking to match a large pool of candidates against a slightly-increased number of jobs.

Megan Alexander, the general manager of Robert Half, says firms limped towards the Christmas break deferring decisions about new projects or investments, leaving their existing IT workforce to try to plug the gaps.

"We're starting the year with a lot of resignations from candidates for permanent positions - they've made a New Year's resolution to get out," she says.

"They've seen their colleagues made redundant, resources pulled off, they've been expected to work extra hours, and there has been no pay increase.

"They're disgruntled, they're serious about moving in 2010, and they want to get the jump on the market," she says.

That churn will create openings, but it's likely firms may have to pay more to attract suitable candidates.

Alexander says many people who last year took jobs below their skill and normal pay levels will look to move on.

"So all those hiring managers who thought they were getting a bargain will be left high and dry."

She says a strong pick up in Australia means many people are being called up to cross the Tasman, often for substantial pay rises.

Many in the IT workforce are on contract, as organisations tried to beat head count mandates by not creating permanent positions.

Martin Barry from Absolute IT detected a pick up in the contracting market in the last few weeks of the year, and expects it to continue.

"Most of it was coming from small to medium enterprises or multinationals with a small presence.

"They were quiet most of the year, but with projects backing up, something has to happen eventually," Barry says.

He's seeing some demand for business analysts and Java and .NET developers.

Barry is also expecting demand this year for SAP specialists, after a quiet 2009.

Fonterra always has SAP projects on the go somewhere, and the German business software firm also supplies systems for some Auckland councils that will have to be modified or rebuilt to cope with the transition to the Super City.

"That will generate a massive amount of work. There's also the public transport and ticketing work, and some flow on from the Rugby World Cup, so the demand side will win out this year," Barry says.

He says contract rates dropped back about 15 per cent last year, but doesn't expect it will take long for that to turn round.

Absolute IT's site, which allows industry professionals to feed in their own rates, show that while the median contract price has dropped to $70 an hour from $80 a year ago, the median salary has stayed about $75,000.

Rona Singer, the Wellington manager for Candle IT, says state sector demand is starting to pick up.

"The Government has been talking about shared services, so there is a bit of work out of that.

"So far the demand has been for project managers and business analysts."

Another recruiter with a strong presence in the capital, Ben Pearson from Beyond IT, says the boost in government positions comes mostly from old vacancies, as managers who over-compensated to the signals coming from the new Government now go looking for bodies to get the work done. "The wave is not fuelled by exciting new projects. It's just a catch-up," Pearson says.

"In Auckland there is more commercial confidence so we are seeing growth in teams as companies, which used last year to position themselves for growth, are now investing in that growth.

"Auckland is the place to watch for corporate career opportunities, rather than Wellington, where it has been for the past nine years."