On the one hand, the immense popularity of new technologies such as AI and robotics has made people believe that robots are eventually going to replace them and take their jobs. However, on the other hand, the acute IT talent shortage is higher than it has ever been before.
A recent study conducted by Korn Ferry in 20 economies around the world shows that by the year 2030, there will be a global human talent shortage of over 85 million people – that’s roughly the total population of Germany! And since talent is directly linked to revenue, it could result in at least $8.5 trillion unrealized annual revenues.
With the daily tech headlines going on about how robots and AI-powered machines are slowly making their way into several industries, it’s easy to overlook the talent shortage. However, by 2030, Russia could potentially face a talent shortage of over 6 million people, China could be facing a shortage twice as large, and even the US will be facing a deficit of over 6 million workers. But that’s not the worst! Countries like Japan, Brazil, and Indonesia can expect a shortage of up to 18 million skilled employees!
The impact of the talent crunch is so significant that it could even dethrone the US as the leader in tech, and the country could lose out on $162 billion worth of revenues annually. On the other hand, India could become the next tech leader, with the study suggesting that India could have a surplus of more than 1 million high-skilled tech workers by 2030.
Given the obvious talent shortage, what are the primary challenges companies face when hiring IT talent? Let’s find out!
1. Finding experienced developers
Today, digital transformation is at the forefront of every business. Almost every company is becoming a tech-oriented country to some degree. This, in turn, has placed a burden on development, operations, and even security teams within the company. A recent report from Modis showed that over 67% of the respondents want to significantly increase their tech and engineering headcount in the next couple of years.
However, at the same time, 41% of the respondents said that finding experienced engineers with the right technical skillset has become increasingly difficult. Over 80% of the hiring managers surveyed said that there is an apparent gap between the talent available and the talent that is actually needed. Apart from the technical skills of a potential candidate, more and more businesses are focusing on their soft skills too. Skills like communication, teamwork, critical observation, problem-solving ability, and adaptability, take the highest precedence in the hiring process.
On the one hand, freshers, straight out of college, lack the skills needed to build top-notch products and services. On the other hand, experienced developers who have spent years learning the ropes of the IT industry no longer want to work for a company – they want to work for themselves. They aren’t usually available in the recruitment market anymore, because they’re more interested in building their own products. This is the primary reason why experienced engineers are hard to recruit.
2. Building a dedicated development team
Because of the acute shortage of talent and the difficulty in finding experienced developers with the right skill set, building a dedicated development team can be quite an impossible mission. On average, creating a well-rounded, self-sufficient development team can take up to a year! More often than not, companies do not have that much time on their hand, especially when they want to scale their operations, build new products and services, and get ahead of the competition.
And it’s not just time here. Hiring recruiters and HR personnel, setting up workspaces, and handling all the admin responsibilities can become overwhelming very quickly. And that’s why companies, especially in the West, would rather offshore their development to emerging tech countries like India.
By partnering with an offshore development company, businesses not only don’t have to worry about all the above factors, but they also gain access to a massive talent pool of the best tech talents in the industry. Going offshore allows companies to scale their team in as less as six weeks sometimes, provided they work with the right offshore partner.
3. Engineers aren’t trained in the newer IT technologies
A study conducted by Docebo stated that engineering professionals around the world want to learn newer IT skills to help them at work, but the training isn’t there. The study also went on to say that at least 40% of older professionals in the UK and 28% of professionals in the US don’t feel like they have the necessary new tech skills to win a new job.
Modern workers are continually feeling the pressure to skill-up, with over 32% of working Americans and at least 1/3rd of working British employees saying that they need to learn a new tech-related skill in order to keep their job. Almost half of the total respondents in both countries said that training in using newer technologies would help increase their chance of a raise/promotion.
However, randomly learning skills doesn’t always put you ahead. According to a HackerRank study, students who undertake traditional education at school often tend to learn older languages in the classroom, but not the newer skills and frameworks employers actually need, such as Artificial Intelligence, Machine Learning, and Mixed Reality – to name a few. You can always learn on your own, but that comes with its own set of challenges. This has made it all the more difficult for recruiters to find skilled IT talent.
4. Salaries are no longer the main priority
A decade or two ago, monetary compensation meant everything. Engineers, irrespective of their experience, were always drawn towards the bigger salary package – it didn’t matter what the company was really about.
However, today, that thought process has taken a 180-degree shift. A competitive salary is no longer the primary demand for some IT experts. Today, the best IT experts in the industry, want to be free from the many boundaries that regular employees have such as defined work hours and filling of a gazillion reports.
To attract them, more and more companies are now offering flexible work timings, remote work, paid meals, paid trips, gym memberships, and a plethora of team-building activities. In such a scenario, ensuring that your potential employee doesn’t join your competition is quite a task!
These are just some of the many challenges that companies face when recruiting IT experts!