Hiring Insights: How Market Changes Are Affecting Tech Hiring in 2023
8 months ago by Michael Boss and Kumar Gawri
The fast-paced technology industry is forever changing, so in today’s article we investigate how market changes are affecting tech hiring in 2023.
The Federal Employment Agency reported that job vacancies have decreased steadily during 2023, compared to 2022. This is not surprising considering the economic challenges raised by the war in Ukraine, higher interest rates, and high inflation.
However, according to McKinsey, the tech skills shortage continues to increase with 700,000 open positions in 2023, expected to rise to 780,000 in 2026. This isn’t helped by the fact that Germany has one of the oldest populations in Europe or that the number of students studying computer science has fallen again. There are huge gaps in its labour force, according to IT industry group Bitkom, with over 137,000 IT jobs unfilled.
Although, the overall jobs market is slowing down in Germany, the demand for tech jobs remains resilient, as businesses look for skilled, experienced IT developers to support their products and services. Our article highlights the top 3 market insights, and how to incorporate them into your tech hiring strategy.
- The importance of training tech professionals
- How remote working could close the skills gap
- How automation and AI could make your business more resilient
Tackle the skills shortage by adjusting company mindsets on learning
The rate of technological innovation is rapidly increasing, meaning a developer could have skills that quickly become obsolete, unless they keep up to date with the latest tech releases. One example is how Apache Kafka went from the tenth most commonly selected data solution in 2018 to the second in 2022. McKinsey compared more than 100 companies listed on Germany’s DAX 40, to the United States company list, Dow Jones. It showed that DAX companies listed 5 percent fewer soft skills in a job ad, and that DAX companies offer employees 24 percent less training hours per year than Dow Jones companies.
By investing in higher levels of training, companies could see a 7 percent higher rate of promotion, and higher staff retention rates. Having enhanced training policies can also attract candidates to want to work for your business, not to mention the big opportunity to improve business agility, by having the latest tech skills available to boost innovation.
Remote working provides great opportunity to close the tech skills gap
Following the pandemic, 44 percent of people returning to work cited flexibility as their top reason for returning, as businesses invested in their IT infrastructure, allowing people to work from home. Offering remote working, for both permanent and contract workers, widens the talent pool. By introducing a “work from anywhere” policy, you could attract German-speaking tech professionals that have moved away from Germany, or are not based near your local office, giving you access to highly skilled professionals to close your skills gap.
Remote working could also increase candidate attraction and retention rates, as workers look for greater work-life balance, avoiding long commutes to the office.
Chief People Officer at Cariad has taken the opportunity with remote working one step further. He’s been quoted saying, “they fire, we hire”, when referring to the large number of tech redundancies in the United States, widening their access to the best global talent in the market.
Tech professionals are key to business efficiency and navigating economic pressures
While businesses feel the pressure of higher interest rates and inflation, countries like the United States have made mass redundancies. This isn’t reflected in Europe as the economy remains more stable, but businesses are looking to introduce more efficiency.
Björn Loose, partner at Cavalry Ventures, commented that ChatGPT might help “businesses iterate on their existing product offerings by implementing the algorithm e.g., by managing unstructured data or by simply automating SQL queries and thus become much more efficient in their operations.”
Attracting and retaining skilled IT developers and experts is the key to maintaining market position and introducing more streamlined processes through innovation, automation, and early adoption of AI, where appropriate.
How we can help you create hiring solutions to navigate the market
Do you want more market insights tailored to your business? We can help offer advice around salary and pay rate benchmarking, benefits packages, and the best techniques to attract specialist IT talent.
We have a talented team of specialist IT recruitment consultants, ready to listen to your requirements.
About the author
Read more about our authors, Michael Boss, and Kumar Gawri in their profiles.
