Although headlines about AI and its potential to replace human work dominate news feeds, the fact remains that human tech talent is essential for businesses. Even as the capabilities of AI grow, human ingenuity will be crucial for creativity, problem-solving, and general checks on technology.
Occupations such as software publishers, data processors, computer systems design, and information services will remain among the fastest-growing industries throughout the next decade. However, there isn’t enough talent to meet the demand.
Korn Ferry estimates that by 2030, as many as 85 million jobs could go unfilled because there isn’t the talent to fill them. These shortages could result in as much as $8.5 trillion in revenue loss.
While these staggering numbers refer to global shortages across various industries, in the US tech sector alone, the country could lose up to $162 billion in revenue amidst the current – and projected – tech talent shortage.
These tech talent shortages are causing companies to look overseas, particularly to India, but this isn’t the only – or best – solution in many cases.
We’ll discuss why this deficit exists and give you some strategies to help overcome the tech talent shortage.
Why Is There a Tech Talent Shortage?
There are a few reasons why the US is experiencing a tech talent shortage.
Reason 1: Retiring Baby Boomers
Baby Boomers, who fill some highly skilled tech talent roles, retired in large numbers amidst the Covid-19 pandemic, fueling the tech talent shortage. Although many didn’t want to retire, the pandemic forced their hand, leaving openings for skilled roles.
Reason 2: Subsequent Talent Gaps
With the acceleration of Boomer retirement came a talent gap that the industry still needs to fill. Many younger employees lack the skills and experience needed to fill more senior-level positions left behind by Boomers.
Even if an employee has the required experience, many are rethinking the traditional career path. They question how much they want to climb the corporate ladder; others are so burnt out that they’ve thrown in the towel for now.
Reason 3: Shifting Expectations
The pandemic permanently changed the employment landscape, giving employees more power to look for better jobs. Many are searching for work-life balance and flexible working arrangements.
A recent post by the World Economic Forum stated that 75% of workers want flexible work, and 69% feel that employment contracts should be based on results, not hours.
In IT specifically, Gartner found that 65% of employees stated flexible work options would “impact their decision to stay at the organization,” with only 29% of IT workers intending to stay with their current employer.
These shifting work expectations, combined with the tech talent shortage, mean employees may feel more secure looking for a job elsewhere if it will better meet their needs.
However, there is a caveat to this as we continue through 2023. With tech layoffs and hiring freezes, employees’ readiness to leave their current company may decline – it could be perceived as too risky.
A skilled tech recruiter will understand this delicate climate and help assuage concerns with legitimate job offers and open dialogue.
Reason 4: Tech Professionals Change Jobs…A Lot
Tech workers tend to switch jobs more than average. McKinsey finds that IT workers, for instance, switch roles every 2.7 years, 20% more frequently than the average 3.2 years. With higher turnover rates, finding and retaining qualified tech talent is more challenging.
(Reason 5:) Stagnant Hiring Processes
Tech talent shortages rage on, but a recent talent report by General Assembly found that hiring practices aren’t evolving to help combat these shortages.
Non-traditional approaches to hiring talent, such as skills-based hiring, aren’t being widely adopted. Further, efforts to hire from a more diverse talent pool aren’t robust enough, with only 27% of tech applicants coming from diverse backgrounds. Diverse hires also tend to stay at companies for less time.
Time-to-hire is slow, averaging 7 weeks, likely because only 18% of HR professionals find speed-to-hire a critical metric to watch. Unfortunately, the longer a tech role stays open, the more costly it becomes.
Lisa Lewin, CEO of General Assembly, comments that companies are aware of the tech talent shortage, but GA’s survey findings speak to inaction.
Businesses may be able to get away with inaction for now. However, as they seek to scale throughout the next decade, companies will be forced to adopt new hiring policies to combat the accelerating tech talent shortage.
6 Strategies to Combat The US Tech Talent Shortage
On average, it costs $30,000 and takes 7 weeks to fill a tech vacancy at a mid- or large-sized company. Considering 91% of leaders are “concerned” or “extremely concerned” about their tech hiring goals for 2023, here’s what you can do to meet your targets better and outperform your peers.
Strategy 1: Invest In Training
Often, the qualifications for tech roles are high. Amidst the current tech talent shortage, employers should be open to training qualified talent. So, what does qualified talent look like in this environment?
If a candidate shows basic aptitude with computers and math and communicates well, you can use that foundation to train a tech professional.
A robust training program means you can build the employee you want, teaching them skills and problem-solving techniques that will allow them to thrive at your organization.
Learn more about training IT professionals here.
Strategy 2: Be Open to Those Without College Degrees
College degrees are usually a minimum requirement for tech jobs, particularly in the US. While this can be relevant for some roles, the fundamental skills of many tech roles can be self-taught if the person is motivated enough.
Try using take-home technical assessments to gauge a candidate’s aptitude rather than a college degree to ensure you aren’t overlooking qualified talent.
The same goes for managerial positions. Look for someone with an aptitude for communication and people skills, two attributes that can be harder to find in tech professionals. Even if they lack a college degree, let their experience and references speak for themselves.
Learn more about how critical college degrees may or may not be here.
Strategy 3: Promote
Training your own employees means you’re building a professional tailored to your organization. Provide ongoing support throughout their time with you and position them for promotion.
Promoting to fill more senior roles can be easier than looking for talent elsewhere because you already know how good of a match the candidate is. It also rewards your employees’ hard work and loyalty, reducing turnover that results from feelings of stagnation.
Here’s how to successfully promote from within, according to Forbes.
Strategy 4: Offer Engaging Work
Combating the tech talent shortage means reducing turnover. Boring work and disengaged employees create higher turnover rates.
Tech professionals are problem solvers, and they need challenges to thrive. Prioritize giving interesting work to everyone and allowing your tech employees to pitch ideas. Divide up tedious “grunt work,” so these tasks don’t become the whole of one person’s day.
Some other ideas for boosting engagement at work include:
- Involving employees in strategy development
- Hosting social events to connect coworkers
- Recognizing a job well done publicly
- Letting employees pitch and lead their own projects
- Being transparent about high-level goals and business challenges
- Offering regular constructive feedback that goes in all directions
Consider an employee engagement survey to get your finger on the pulse.
Strategy 5: Put Your People First
Tech talent is difficult to find, so companies that want to attract the best talent – and even entice someone to leave their secure job elsewhere – need to put their employees first.
Putting employees first means offering:
- Competitive (above average) compensation and benefits
- Flexible working arrangements
- An autonomous environment where output quality is valued more than hours worked
- Public employee recognition for jobs well done
- Regular feedback and transparency about performance evaluations
- Transparency on big-picture business objectives and values
- A diverse and inclusive environment (almost 80% of workers in a CNBC survey said that
they “want to work for a company that values diversity, equity, and inclusion”)
- An environment rooted in trust, support, and transparency
Considering 82% of employees evaluate employer brand and reputation before applying for a job, companies must be notorious for valuing their employees to attract leading tech talent.
Strategy 6: Work Closely With a Tech Recruiter
Amidst tech talent shortages and an uncertain economic future, time is of the essence when hiring. Consider forming a relationship with a recruitment firm to save time and money during the tech recruitment process.
Jennings Executive has over two decades of combined experience matching companies with leading talent. We’ll help you generate value for all stakeholders by sourcing the best candidates and building elite tech teams. Contact us today for your tech recruitment needs!