According to the Office for National Statistics, there are still more than 1.1 million job vacancies in the UK.
While all sectors are struggling to find the right workers, we are witnessing a chronic shortage of skilled talent in tech as employers rush to keep up with the rapid pace of development in the sector.
It does not necessarily follow that because ‘Big Tech’ firms are making redundancies, there will be more talent available. Those who have been laid off will be swept up quickly by those with big hiring budgets, so businesses hoping to find top talent at reduced rates will struggle.
A recent industry report revealed that around 80% of British businesses say they are having difficulty filling jobs, the highest rate since 2006. The same number in the information technology sector noted they were struggling to fill vacancies, compared to 65% in communications services.
One of the issues here may be the discrepancy in salary expectations between candidates and businesses. Typically, in a time of economic uncertainty, salary growth would grind to a halt, particularly against the backdrop of some of the world’s biggest companies laying off workers. But these are not normal times. Salary inflation is showing little sign of stopping, talent supply in the tech sector is still failing to meet demand, and companies who aren’t prepared or able to go above and beyond on salary are losing out.
Difficulties lie ahead
And finding the right candidate for the job is likely to get even more difficult. The hundreds of thousands of workers who left the labour market during the pandemic have not been tempted back as yet and the skills gap of those still economically active continues to widen.
Businesses that manage hiring themselves are finding that attracting the very best candidates is becoming harder, and the whole process is more time-consuming than it has been in the past. Given the lightning pace the tech industry operates at, firms should lean on specialist recruiters to source and secure the small number of high calibre candidates on the market – considering temporary workers as a smart interim solution.
Well-executed business strategies are contingent on having the right people in the right roles, at the right time – never more applicable than at a time of enduring economic uncertainty. With this in mind, and in a deeply competitive market, tech business leaders must recognise the value of partnering with sector experts to efficiently identify and secure the top talent.
Are tech firms offering the right package?
With the rising cost of living, potential employees will not be prepared to take a salary cut. Released at the start of 2023, Michael Page’s Technology Salary Guide sets out market rate salaries for each sector across all parts of the UK. Unsurprisingly, London commands the highest average salaries but it is interesting to note that the Northwest and Yorkshire are next in line.
In recent years, the Northwest has emerged as a tech hub and new, well-paid jobs are cropping up in good numbers. More than 222,000 people are now employed by tech startups and scaleups in the region, supported by a significant increase in local venture capital funding, shooting up 43.7% to $975m in 2021.
Irrespective of location, firms up and down the country should be mindful of the pull of remuneration. According to our own data, 40% of jobseekers agree that yearly salary increases are their top consideration.
EVP is the MVP
However, businesses also need to focus on their wider employer value proposition (EVP). Finding a balance between salary, opportunities to work with the latest tech, and flexible working is critical for creating an environment in which employees want to work. This will aid staff retention, as well as acquisition.
While half of the tech candidates we recently surveyed list flexible working as their top non-financial perk, ways of working are currently in a state of flux. Many companies are trying to draw workers back to the office, which may be at odds with the expectations of employees who are accustomed to working from home full-time – particularly in a sector such as tech where remote opportunities are greater. Compromise may be needed for now, but honesty around future plans is important for creating trust and retaining new hires too.
The pace and quality of the hiring process is also incredibly important. Top technology professionals are generally snapped up quickly, whether they are permanent or temporary. If recruitment processes take too long, candidates may receive and accept other offers, leaving businesses at risk of losing out on their top choices.
Could interim talent be the answer?
Given competition in the market, it is not always easy for businesses to find the right permanent talent straight out of the gate. Where there is a need for talent quickly, it may be helpful to bring in contractors instead.
By redeploying part of a project budget to hire temporary workers, businesses can beat the talent shortage, hire from a higher calibre talent pool, and reduce competition. Contractors also tend to be more efficient and flexible and, because of the nature of what they do, they are used to working in states of flux or ambiguity – all of which are highly desirable skills in the current market.
As more and more businesses develop sophisticated digital offerings, modernise their infrastructure, and aim to secure their businesses against cyberattacks, filling the rising demand for tech skills from a shrunken workforce will not be simple. Securing the cream of the tech worker crop will perhaps require some outside the box thinking and taking quick, but informed, action if the opportunity arises.
Contractors are by no means a one size fits all solution, but the strategic use of interim talent can make all the difference in steadying the ship in these times of economic uncertainty. Who knows? An interim hire may well prove such a good fit that it becomes a long-term, permanent placement.
About the Author
James Barrett is Managing Director, Michael Page Technology & Transformation. James is responsible for driving the ongoing growth and development of Michael Page’s digital and technology proposition across the UK, having joined the company back in 2006. Under his stewardship, Michael Page’s Technology & Transformation teams have triple in size since 2016.
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