Yesterday’s Progress = Today’s Challenge?
The Tech-Skill Gap
Working within the IT industry over the past years (and also growing up hearing about the changes within the industry from my dad, a former GM at IBM — thanks dad!!!) I’ve always been fascinated by the pace at which this industry, and software development (methodologies) in particular, evolves. And alongside it — the people.
It can sometimes feel overwhelming to keep up with the continuous progress we are making with everything involved in delivering high-quality software faster. New buzz-words are popping up everywhere, all the time. New technologies need to be learned. New skills are being sought after. Corresponding Tech-talent is in short supply.
I see, feel and hear it every day, via exchanges with my network, working with clients or when chatting with a colleague over a virtual coffee (or so… ;-) ). There are a lot of opportunities but also challenges that arose with the evolution of software development over the past decades — tool- & process-standardization linked to scalability, automation needs, communication, security, and particularly with managing team hypergrowth & onboarding processes (especially in the past 18 months with everyone working remotely & COVID being the CEO of Digital Transformation).
Now one might say it is not surprising that I am writing a blog post covering this topic when working for a company like Tarmac.io (who can very well support in this challenge ;-) But that’s not the point of this article!). On the contrary: My origins in IT lie within a company providing software solutions (Digital.ai). What I have learned over time is that the challenges organizations are trying to solve today are not only their tools. They are struggling to find the (right) resources to maximize the benefits of the tools they are buying. So I decided to look into this in more depth.
I did focus my recent research on the Netherlands, not only because I live here, but also because the Netherlands’ tech sector is booming. Out of the research conducted, I would like to highlight 3 points as to why companies are struggling to fill their IT positions that I believe can be applied across borders.
THE CHALLENGES OF TEAM HYPERGROWTH
The Tech Skill-Gap in The Netherlands (and beyond)
Findings in the report IT Labour Market Monitor 2019 by Sterksens (a specialist IT recruitment firm located in the Randstad area) state that
“The IT labour market in the Netherlands is struggling with extreme shortages. … There’s a huge increase in the number of IT vacancies. Not just in the Randstad but in all the other provinces as well, 4 out of 5 job openings published online can’t be filled by active job seekers. … Because of their inability to fill IT positions, many companies are struggling with their core activities.”
The Amsterdam Economic Board in another report believes “shortages of tech professionals could hamper the growth of the local economy”. Currently, Amsterdam’s tech sector includes more than 700 companies which employ almost 52,000 people, and its FinTech sector alone has seen a 35% growth in jobs since 2017”.
Truly eye-opening are recent predictions noted in the G20 insights: estimating a potential gap of 700,000 IT workers in the EU by 2030.
Power shifting to the Employee
Needless to say that this imbalance leads to an increase in power on the employee side. This is furthermore fueled by the following two points as per a recent article from Bloom Blog:
The pandemic opened up a whole new world of opportunities for sought-after talent — being put into a work-from-home situation a lot of people now do not want to go back to working at an office every day. Additionally, companies have found ways of making remote work, work (duplicate word intended ;-) ). Employees that are unfulfilled in their current environment now have the opportunity to switch jobs far more easily, even to companies based in a different country or on an entirely different continent.
Large Global Players
As if the top two points weren’t enough, a lot of companies see competition in large global players like Netflix or Microsoft. Having pockets deep enough, they tend to pay inflated salaries, grabbing high-quality talent off the market quickly. Would you say no, to an offer that is € 40.000, — to € 50.000, — above your current income? With the large global players struggling to keep up with the salary arms race, where does that leave start-ups & scale-ups that make up the majority of our economy?
MEETING THE CHALLENGE
Finding the right people that fit your team from a skill and cultural point of view is a complex challenge. While the Government and industry are investing in the development of the required skills, and the popularity of IT studies keeps increasing, the dropout rate amongst applied IT sciences keeps increasing as well. Sitting at 58%, making it the highest dropout rate compared to any other academic study, skill development is clearly a long-term solution.
I believe we need to think outside the box to find ways of filling the growing tech skill gap to ensure our existing teams perform at their best and for our business as a whole to be enabled to carry out its core activities and meet the end-user’s needs.
How are you planning to overcome the more immediate need? Have you considered spreading the net wider and tapping into the global talent pool?
Thanks for reading!
