Update software programs, build more robust networks, create better security systems…
Technology hiring and investment have been two bright spots in an overall slow job market and uneven economic recovery. Today, the question is – can it continue? Companies have already made commitments to reignite technology projects that were put on hold during the economic downturn and to deal with inadequate resources. Even with fresh doubts on the economy, those commitments will likely be fulfilled.
“Companies are playing a bit of catch-up in terms of their infrastructure, as well as the IT staff they need to replace aging hardware and software and who can deal with security challenges,” says Tom Silver, senior vice president of North America for Dice Holdings, Inc.
Now tech professionals with specific skill sets, such as mobile application development or the ability to program in multiple languages, are in high demand. Several forces have converged to create a talent crunch in the tech sector, which is driving competition to lure tech talent and lucrative compensation packages for even newly minted tech professionals:
• Low tech unemployment — As of July 2011, the unemployment rate for computer and mathematical professionals was just 4.7% – about half of the overall U.S. labor market rate. Trends indicate that tech sector hiring will continue to increase throughout 2011. “The search for exceptional, top-quality technical candidates is alive and well as companies struggle to attain the level of talent they desperately need. The war for talent is still fiercely competitive at the top levels,” says Craig Hufford, technology search managing partner and practice lead at NextGen Global Executive Search.
Source: U.S. Bureau of Labor Statistics, July 2011.
• Mobile technology boom — The acceleration of the digital revolution is driving demand for mobile application developers, high-level programmers and network systems experts. While these sought-after IT professionals know how to harness technology to help companies run more efficiently and increase revenue, there aren’t enough of them. In fact, job postings on Dice that include some specific tech skills have more than doubled in the last year.
Source: Dice.com jobs posted on Aug. 2, 2010 and Aug. 1, 2011.
• More start-ups — A wave of investment dollars is fueling the growth of many new start-up companies, which is putting pressure on the tech hiring market. Even big name employers such as Google and Facebook are struggling to attain and retain top tech talent. In a widely publicized retention effort toward the end of last year, Google gave all its employees a 10% raise and a $1,000 bonus.
Tech Hiring Gets Aggressive
As a result of the tight IT hiring market, the battle amongst employers for top tech talent is intensifying. Companies around the country are reporting that more aggressive hiring tactics are being used to lure tech professionals away from their current employers. And many think that process is only going to accelerate. According to a recent Dice survey, 54% of employers expect competition for top tech talent to increase this year compared to 2010, while just 3% expect that competition to decrease.
So how do you know if your staff members are looking elsewhere for work? “If there is a noticeable change in an employee’s work habits, such as single day absences, a disengaged attitude, changing to more formal dress, and frequent sick days, these are all indications that the person is looking around,” advises Silver.
Five Proactive Retention Strategies
You can’t completely protect your organization from competing with other employers, but you can use proactive retention strategies so that employees are less inclined to entertain offers from other companies. Putting in the effort up front is worthwhile because it’s difficult to retain employees once they’ve begun to seek employment elsewhere, even with additional compensation or advancement opportunities. “When companies react to a person leaving, they often cannot change the really important reasons why the person is leaving, irrespective of the amount of money they throw at him,” says Hufford.
#1: Make sure it’s a match — Tech professionals have a slightly different motivation from other employees, says Herb Gosewisch, partner at U.S. Alliance Partners, a consultancy focused on employee engagement and sustainability practices. “They have more loyalty to their career and personal development than the company that employs them,” he says. “IT workers tend to stay longer and find more satisfaction when they feel they can ‘own’ their work and it’s something they influence from a creative point of view.”
So the stronger the match between the job requirements and the employee’s skills, goals and values, the more likely it is that the employee will want to stay. “Focus on a key individual and make sure that the projects they’re working on allow them to continue to develop their skill set,” says Silver.
#2: Start strong — Retention efforts should begin during onboarding. “All the recent studies suggest that new employees determine within the first few months of employment whether or not they made a good decision,” says Gosewisch. Engaging new employees in the company culture and business infrastructure from day one will improve employees’ experiences and prospects for staying.
#3: Reduce burnout — In today’s fast-paced IT work environments, stress levels and burnout can run high and lead to employee turnover. Evaluate your project management and organizational approaches, seek ways to improve work-life balance and ensure equitable delineation of duties. Better yet, ask your technology employees for their input on lowering stress and lightening workloads.
#4: Conduct motivation checks — Regularly assessing your employees’ motivation for their work gives you valuable insight into their level of engagement and allows you to make strategic adjustments. Motivation checks also serve as an early warning system. “Regular assessment gives you the opportunity to identify the people who are thinking about leaving or who are somehow dissatisfied with the work or the environment,” says Gosewisch. He adds that getting regular feedback from employees often uncovers small management issues that can be corrected before they become big problems.
#5: Develop a sustainability strategy — Believe it or not, your company’s commitment to the environment, the community and innovation is very important to many key employees, especially Generation Ys and Millennials who often have the most experience with leading-edge technology. These two generations grew up surrounded with environmental messages they see as important. “An employer needs to show that it has a strategy to not only be profitable and exciting, but that it has a social and environmental conscience. It also needs to show that it allows employees inside the company to be innovative and have a voice,” says Steve Caballero, partner at U.S. Alliance Partners. “Making a profit at the expense of the planet, the community, and your people does not cut it anymore.”
Show Me the…Promotion
Beyond organizational and management changes there are other, more tangible things that employers can do to improve retention. While giving employees salary increases is the first and most obvious approach, money isn’t the only answer.
The charts below show rankings of what retention benefits employers are offering versus what benefits employees actually want.
Source: Dice employer survey, March 2011.
Source: Dice survey of tech professionals, June 2011.
For the remainder of the year, the technology recruiting market is expected to remain healthy. With certain shortages in metropolitan areas and skill sets, competition amongst employers for top tech talent will continue giving tech professionals the upper hand in the job market. “Tech professionals know that the pendulum has swung back in their favor a little,” says Silver. This means employers need to step up their game – quickly.
The best place to start is a careful and complete review of employee retention practices, benefits and onboarding processes. The focus should be on what the company offers versus what employees and prospective tech candidates actually want. Silver advises, “The IT hiring market is tight and employers don’t want to lose good people. Now is the time to act.”