I work for a smaller development company and we’re actively trying to hire.

I think it is important to separate general “IT” from “Software Development”. A non technology company views IT developers as a cost center, a software company views developers as a profit center and treats them as such.

Good developers (that are in the field because they view it as an art and a creative endeavor) will not have a problem finding work, even in this market. Developers that are in it to collect a pay check will struggle when faced with outsourced labor that will do it with the same lack of passion but cheaper.

There is a very interesting thread on Joel on Software where developers are discussing the current job market and desire to leave the industry. Very relevant to this thread: http://discuss.joelonsoftware.com/default.asp?joel.3.718003.14