Unfortunatly certs have now become the -bottom- line requirement for most new IT jobs, and they tend to be pretty high end ones when it comes to windows (MCSE 2k not MCSA)
I think certs do have thier place, but there will never be a replacement for experiance
and they can put is in a sticky situation
recently I found myself in a bit of middle ground, having passed my CCIE Written exam I was far too expensive for small companies to warrant hiring me (although i would of accepted anything, thats not how it works for them though), yet my experiance (although I have 6 years of it) was limited to smaller environments and I had no blue chip names on my resume (which means no blue chips would hire me anyway, catch 22?)
I landed a new job the other week though, foothold job in an investment bank thank god, which gets me into the financial field, which is great!
currently I have a fair few certs, with a few more to come
but they mean nothing compared to experiance
the problem lies with the process of hiring in most organisations
job specs are drawn up by IT, HR put out the add with some buzz words (MCSE 10 years experiance) recruitment consultant goes on what they recieve from HR, the IT manager may well of been quite happy with some of the other candidates skills, but those resumes may never leave the recruitment consultants inbox!
things will inevitably pick up in IT
the industry is vast and its skills are required in pretty much every organisation on the planet
and although the bottom run of the ladder is being oversubscribed due to cheap training and all those "change your career today" type ads and courses, the mid - high end will become more and more specialised and roles will appear, gettign a CCNA, MCSA, CNA and a CLS will really get you no where other than a really broad skill set at a very general level.
That's my job. 
