Compiled byLisa Hofmann According to Stamford, Conn.-based META Group's 2000 IT Staffing and Compensation Guide , demand for IT services in the United States is growing at 25% annually, but unfilled positions -- an estimated 850,000 by the end of 2000 -- will stunt this growth. Of the 500 compensation and IT specialists interviewed, 75% report that they are understaffed for adequate growth; this despite 51% of respondents saying they continue to increase their IT staffs. One challenge faced by companies is that gaining and retaining employees has become competitive. The study finds that 75% of those polled perceive retention as a "very serious" or "serious" problem. To combat this, organizations are paying higher salaries and offering incentives; 80% of responding organizations pay higher salaries for IT employees than for non-technical employees. To lure and retain key employees, 93% of respondents provide tuition incentives, while 44% offer stock options, and 45% give project bonuses, the study finds. "The move to the information economy from the information age -- from merely compiling large amounts of data to transacting commerce and business exchanges based on that information -- requires an increasingly talented pool of employees," says report author Maria Schafer, program director with META Group's Executive Services.