Phoenix has long been one of America’s fastest-growing cities, with more than 100,000 new residents arriving annually. In recent months, however, the economy hasn't kept up its pace and workers - including those in the tech sector - have taken a hit. The raw stats are rough. On Dice, the number of IT job listings for Phoenix plunged 21 percent in the fourth quarter, to 1,384. Seasonality may be partially to blame, but it's the biggest drop among all the cities Dice tracks. It's a discouraging sign for the first quarter.

Here's how Dice forum commenter "Red95king" assesses the situation: "I'm a 15-year network administrator currently in the Phoenix area. The IT job market is dead and has been buried for seven years. Put a fork in it. My last admin job (in 2006) paid the same as I was making in 1999. How discouraging is that? Factor in inflation, and wages have certainly crashed. There is a glut of applicants for every position."

Despite such sentiments Tracey Herrick, executive sales recruiter at TriStaff Group, says that in recent years many tech businesses have brought either headquarters or satellite branches to the area. "Investors and entrepreneurs are very attracted to Phoenix for its affordable locations and its proximity to California. Something must be going on here to attract companies like Google, Amazon, and Monster."

Boosters also point out that Fab 32, Intel's $3 billion, 300-mm wafer fabrication facility (in nearby Chandler) finally came online in October, creating 1,000 jobs. Nationwide, Arizona ranks fourth in semiconductor manufacturing employment, with 22,500 workers.

Jason Miller, branch manager of IT recruiter Sapphire Technologies' Phoenix office, says that despite the tougher economic climate, "demand has remained strong for Java, J2EE, and .NET developers, project managers, business analysts, and SAP consultants throughout the year." In 2007, he adds, "the semiconductor and aerospace industries had a strong year. Aerospace in particular has been fruitful, increasing the demand for IT resources."

Miller is cautiously optimistic. "Though companies are indicating they may not hire as much as they did in 2007, the forecasts are still positive, and demand sounds like it will still be quite strong, especially on the contracting side."

Still, there's work to be done to keep the Phoenix IT job market healthy. As Sean Holstege wrote in the Arizona Republic, "For the economic overhaul many say is now vital, Phoenix can learn from the examples of other American cities. Many, with economic collapse upon them, saw a chance at salvation … reinventing themselves as models of a new kind of prosperity. Others, such as Detroit, are still reeling. Phoenix, for now, has a solid economy. But looking ahead, the region's foundations are slowly being undermined. Phoenix has not evolved with the times."