Tech unemployment hasn’t been this low since the turn of the century, according to U.S. Bureau of Labor Statistics (BLS) data crunched by CompTIA. That creates issues for hiring managers and recruiters on the hunt for top talent, because the vast majority of tech professionals clearly have a job.
As of May, tech’s unemployment rate sat at 1.3 percent. “There is now the very real prospect of tech worker shortages affecting industry growth,” Tim Herbert, executive vice president for research and market intelligence at CompTIA, wrote in a statement accompanying the data. “Firms seeking to expand into new areas such as the Internet of Things, robotic process automation or artificial intelligence may be inhibited by a lack of workers with these advanced skills, not to mention shortages in the complementary areas of technology infrastructure and cybersecurity.”
Tech’s unemployment rate previously hit 1.4 percent, in April 2007 and March 2018. (The BLS began measuring occupation-level employment data in January 2000.) However, not all segments within tech are adding jobs at the same rate; although custom software development and computer systems design gained 8,400 new positions in May, for example, both information services and telecommunications saw modest losses.
Meanwhile, new data from PayScale suggests that wages within the tech industry grew 2.3 percent year-over-year in the second quarter of 2019. That’s an indicator that the low unemployment rate is forcing employers to pay more in order to secure the talent they need.
And that’s very good news for tech professionals, because Dice’s data showed tech salaries stagnating between 2017 and 2018, when they only increased 0.7 percent, to an average of $93,244. As we noted in this year’s Salary Survey, some 68 percent of tech professionals are interested in changing employers in order to receive higher compensation (well ahead of those who said they’d jump jobs for better working conditions or more responsibility).
But that’s not quite so fantastic for hiring managers wrestling with tight budgets. Squeezed by realities, some companies may turn to a different kind of solution: Rather than hunt for expensive talent, they may try to train their existing employees to manage necessary tech tasks (just like Amazon!). At least in theory, education is easier and less expensive than hiring and onboarding someone new.
The other question is how long the tech industry can maintain its stellar unemployment rate. When it comes to employment, what goes down will inevitably go up at some point, driven by larger circumstances outside of the industry’s control. That might put more tech professionals out there, looking for work, but it might also mean that companies are struggling with a sluggish economy.