IT Job Growth a Mere Trickle in November Due to Ongoing Supply Shortages

IT Hiring Challenging and Projects Impacted Because of Talent Scarcity, says TechServe Alliance

Alexandria, VA, December 8, 2021 – After a strong recovery in IT employment since last August, employment growth in the IT sector slowed down to a trickle in November. The sector added 2,200 workers last month, a sequential increase of 0.04% to 5,385,400 jobs, according to TechServe Alliance, the national trade association of the IT & Engineering Staffing and Solutions Industry. On a year-over-year basis, IT employment was up 3.17% since November 2020, adding 165,600 IT workers.

Growth in Engineering employment also slowed down significantly to 0.16% sequentially, adding 4,200 workers to end the month at 2,658,800. On a year-over-year basis, engineering employment increased by 3.38% since November 2020, adding 86,900 engineering workers.

“While uncertainty about the impact of the Omicron variant did somewhat impact the IT sector, the slowdown in IT jobs market is more related to the supply squeeze on available talent rather than demand,” said Mark Roberts, CEO of TechServe Alliance. “Our members are telling us that their clients’ IT hiring needs are still unmet and projects are getting delayed because of lack of qualified IT professionals. “At this point, there is little likelihood the domestic talent pipeline will significantly expand in the foreseeable future. This is causing not only strong wage growth but also a need to offer a flexible work environment. In this tight labor market, what candidates want really matters and could make or break the success of IT initiatives,” Roberts added.

The following table presents information about the total number of jobs in certain sectors that provide a significant amount of employment for IT and engineering professionals.

Technical note: TechServe Alliance’s IT Employment Index and Engineering Employment Index are the first specific measurements of IT and engineering employment. These unique measurements of total IT and engineering employment are created monthly by studying the ongoing staffing patterns of a dozen IT and computer related occupations in 22 industries and industry sectors employing significant numbers of IT workers and nearly two dozen engineering occupations in 30 select industries and industry sectors employing significant numbers of engineering workers. Both the monthly IT Employment and Engineering Employment Indices are based on U.S. Bureau of Labor Statistics (BLS) data, which is subject to monthly revisions, and is revised accordingly. Both indices are also subject to periodic revisions and annual rebenchmarking that includes revisions to several years of employment data, which also may incorporate new occupational definitions. Both indices were re-benchmarked going back several years through January 2021 data. In addition, both indices are subject to minor revisions to March and April data. The next major revision will be published in February 2022.

ABOUT TechServe Alliance
TechServe Alliance is the national trade association of the IT & Engineering staffing and solutions industry. IT & Engineering staffing and solutions firms count on TechServe Alliance to keep their leadership informed, engaged, and connected. TechServe Alliance serves as the voice of the industry before the policymakers and the national and trade press. By providing access to the knowledge and best practices of an entire ndustry and tapping the “collective scale” of its members, TechServe Alliance supports its members in the efficient delivery of best-in-class IT & Engineering staffing and solutions for clients and exceptional professional opportunities for every consultant.

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It’s surprising that some firms are taking a stronger stance on returning people to the office. After a year of positive feedback which included high worker productivity, better work-life balance, and broader access to a wider range of talent, it seemed that working remotely post-covid was a foregone conclusion. Now I’m not so sure.

A company’s policy on remote work will have ramifications on its ability to attract and retain talent. Microsoft surveyed more than 30,000 full-time and self-employed workers. The survey stated that “nearly three-quarters said they wanted flexible remote work options to continue and 46% said they were planning to move this year now that they could work remotely.”

Jared Spartaro, corporate vice president for Microsoft 365 said, “There are some companies that think, ‘We’re just going to back to how it was.’ However, the data does seem to indicate that they don’t understand what has happened over the last 12 months.”

In my opinion, having a restrictive WFH policy will shrink the available pool of talent especially to companies located in areas with difficult commutes. For some in-demand skill sets such as Cloud or DevOps, this shrinks an already small talent pool even further. Companies also run the risk of losing current staff to firms with more flexible WFH options.

Some things to consider when developing your WFH policy.

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How Can Employers Benefit From This?

Putting employees through new training programs can be an expensive endeavor, however, proponents of the practice feel that it provides a worthwhile return on the investment. Employees are likely to feel a stronger sense of loyalty to the company and a renewed sense of enthusiasm and purpose. This can translate to financial savings by reducing the cost of recruiting new talent and the time it takes to get them up to speed, where a long-time employee already has that background knowledge.

Offering upskilling opportunities also makes the company more attractive to job seekers. NYU Professor, Ari Ginsberg shares, “Generation Z is already fairly tech-savvy and is more likely to be attracted and stay in a place where they can get technology learning.”

Why Is It a Risk?

Amazon recently made news with its announcement in July that it start a $700 million retraining program for its employees to help them further their careers at Amazon in other fields.

In an article published by UPenn., Wharton professor of management, Matthew Bidwell has this to say: “There is the concern that if you give people training in transferable skills, either they leave, or the threat that they’re going to leave means that they can demand much higher wages — and that eats away any of the returns [from the] training,” he said.

Investors and shareholders are more comfortable laying off workers who no longer have skill sets needed by the company and hiring newer, more tech savvy staff. Most don’t see the monetary value in investing in a complete training program for employees who may have capped out their salaries and could be replaced by better skilled talent at a lower overall cost.

To invest in current employees seems to be an open invitation for those employees to take their years of experience and newfound skills to another company, wasting the money spent on training them. Accepting upskilling as a standard practice will take time for shareholders and investors to embrace.

A recent article in The Wall Street Journal shares, “Cumulatively, firms spend billions of dollars every year on technology devoted to digital transformation, but executives admit to confusion and uncertainty about the impact. A recent Accenture survey of 1,200 executives found that, while nearly half say skill shortages are a major concern for the future of their firm, only 3% said they will significantly increase their training budgets over the next three years. In a separate survey conducted in 2017 by consultancy McKinsey & Co., 35% of U.S. executives said they believe they will realize their digital goals mainly or only by hiring new talent.”

How to Make Upskilling Work

Can upskilling benefit your company? It’s easy to say that upskilling is a win-win for all involved, however the truth is that upskilling is not a one-size fits all answer. Each company has to evaluate the pros and cons to determine if it would work for them. However, helping employees develop a logical career path with the appropriate training can certainly help with retention, employee engagement, and job satisfaction, if done correctly. Watching what other companies, like Amazon, are doing with their upskilling initiatives can help you determine if this is a path that will benefit your company in the future.

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Companies are beginning to understand that stress in the workplace cannot be overlooked or considered just part of the job. The World Health Organization (WHO) reports that depression and anxiety disorders cost approximately $1 trillion in global productivity losses per year. Getting in front of this and proactively providing for their employee’s mental health needs benefits everyone involved.

Sophie Downs, writer for Inc.com, shares “today’s top employers are embracing a broad definition of ‘wellness’ and viewing stress as a health concern rather than just a cost of doing business.

They’re organizing group sessions with social workers, subsidizing employees’ therapy bills, and granting workers no-strings-attached stipends to use on massages, life coaches, vacations, and even essential oils. Some are even offering paid sabbaticals to long-serving employees.”

Angelica Levito, with CNBC.com, expands on this, “Some employers are making the treatment of mental illness a top priority — on par with combating cancer, diabetes, and other chronic ailments… Stress can cause people physical harm. Constantly worrying about work can lead to erratic eating habits and cut into exercise routines, which can lead to weight problems, high blood pressure, and higher cholesterol levels, according to the APA.”

Attending to employee’s mental health needs proactively also means likely preventing thousands of dollars in medical care for chronic illnesses that are exacerbated or caused by stress.

Employers are getting creative in their offerings and trying to meet people where they are, understanding that many of their employees may not take the initiative to schedule counseling appointments or see a psychiatrist for fear of coworkers and managers learning about their struggles. To this end, companies are starting to offer a variety of benefits that allow employees to discreetly and privately take small steps to improve their stress levels. Some employers are paying for subscriptions to apps that help with relaxation or meditation.

Telehealth is another option that seems tailor-made for addressing mental health concerns in the workplace. Employees can at their convenience “meet” with mental health providers in a chat setting or using FaceTime, never needing to take time off of work for a traditional therapist appointment.

Heather Huhman, a writer for Entrepreneur.com, says, “Offering telehealth not only provides more options regarding mental health treatment but also limits the uncomfortable explanations employees must give management about their absence… Offer counseling — online and offline — to everyone on your team. “

For great examples of employer’s that are doing big things to help their employees live a more balanced life you need look no further than companies like Google, Apple, Microsoft, and Samsung, who have been offering wellness benefits for years, providing everything from gym memberships to wellness coaching and in-office massages.

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Unlimited vacation time is surely gaining the attention of many; critics and supporters alike. “The 2017 State of the American Workplace Report from Gallup showed that 53 percent of employees say it’s “very important” to have a job that allows them greater work-life balance and personal well-being. Unlimited vacation time could help achieve both of these, by offering what is still a somewhat unique opportunity in the business landscape,” shares John Boitnott, writer for Inc.com.

We decided to do a deeper dive into this newest trend and see if it’s really as great as it sounds. Here’s what we found.

Unlimited doesn’t always mean unlimited

Sure your employers may not track your days off, but you can’t just take off on a whim. Most of these policies (and even the ones that don’t have this in their policies) are not going to permit you to take days off if it’s impacting the work that you need to get done. You still have to meet deadlines, and you still have to make sure that your days off don’t mean more work for your coworkers.

Stacy Lastoe with TheMuse.com says, “While your boss may not be keeping tabs on how many days you took off last month or year, that doesn’t mean you’re at liberty to take off as much time as you want. After all, you have a job to do. You’re getting paid to do said job—not go on vacation.”

Some people feel that even though the policy may be for unlimited time that they will still somehow be penalized for taking time off. If you work in a high-stress environment or one with many deadlines, you may never feel that it’s an okay time to take off, even if the policy permits it. Co-workers may frown on using too many of the days off you’re allotted, and it could essentially end up costing you opportunities to be promoted, in this type of environment.

Look for flexibility

There are companies that have mastered this unlimited vacation policy and are doing it well. Most of these companies understand the importance of flexibility for their employees. And the type of employees that they look for are those that don’t necessarily want to spend three months a year lounging on a beach but instead want to be able to work when it’s best for them. In some cases, these employees have family obligations that may require time off occasionally. In other cases, you may have someone in a project driven job that works best later in the day than they do in the mornings and doesn’t want those unlimited vacation days as much as they want to be able to come in when they’re most productive.

Is it achieving the benefit that everyone hoped?

There are also some companies that have reversed their decision to offer unlimited vacation time. However, the reason may surprise you. Instead of employees abusing the benefit, more and more companies are finding that employees are actually taking less vacation time than they did when they had limited vacation days.

Todd Wasserman with ADP.com shares, “One of the bizarre things about unlimited vacation policy is that it seems to have the opposite effect of what’s intended. For instance, when British photography equipment company Triggertrap began offering unlimited paid time-off (UPTO) in 2015, the average employee took less vacation than before the change, according to Slate.”

Unlimited vacation time can be a great benefit when managed properly and when there are clear guidelines on how it should be used, but it’s not always as clear cut as it seems. Be sure to clarify with your recruiter or human resources manager what those guidelines are and even find out how many people utilize the unlimited days and if they’ve seen an increase or decrease in time off since offering the benefit. You can also check their employee turnover, which is sign if policies and procedures are working.

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The Impact on Hiring Managers

As a hiring manager or recruiter, you’re no doubt used to sharing the benefits that your company provides to its workforce with potential employees. While salary and traditional benefits such as insurance coverage and paid time off are still the most important benefits that most employees are looking for, it’s worth your time and energy also to learn what energizes and engages the workers in your company. Who is “the customer” and how are they benefited by the work of your employees? What makes your current employees feel that they’ve done a good job?

Why meaningful work matters

An article on ExistentialPsychology.org shares this perspective:

“When one considers the amount of time that most people spend “at work” during their lifetime, it is no wonder that the search for meaning in a work context is so vitally important.”

“Dr. Viktor Frankl’s Existential Analysis and Logotherapy is the commitment to meaningful values and goals. In brief, Dr. Frankl identified three categories of values that, when actualized, provide sources of authentic meaning: creative values, that is, “by doing or creating something; experiential values, that is, “by experiencing something or encountering someone”; and attitudinal values, that is, “by choosing one’s attitude toward suffering.””

The ability to clearly see where they have helped someone in the course of their workday is a strong motivator and one that seems to boost employee’s positive feelings about their work. That’s an easy thing to identify when you work in a service industry, whereas helping people in a trauma setting or an emergency is part of the work environment, but what about jobs where the benefit to others may not be so obvious?

John Coleman, a writer for Harvard Business Review, has been studying how employees find meaning in their work and shares, “For most people purpose is built not found. Working with a sense of purpose day-in and day-out is an act of will that takes thoughtfulness and practice.”

Would employees sacrifice money for meaning?

Better Up Labs is a leadership development company that recently did an in-depth study on meaningful work. Referenced by both CNBC and SHRM, Better Up Labs shared that 9 out of 10 career professionals told researchers they would give up an average of $21,000 a year—for “work that is always meaningful.” Further research revealed that employees stayed with a company seven months longer when they were in a job that they felt was meaningful. They also used fewer sick days and personal time off compared to employees that did not have a job considered highly meaningful.

Helping your employees find the value in their job will benefit both of you in the long run. Your employee will be happier, more productive, and more likely to stay with your company.

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“Work-life balance” refers to a worker’s ability to maintain a healthy balance among their responsibilities at work, family life, and personal obligations. In today’s times, employees all over the country are seeing personal responsibilities increase across the board: elder care, childcare, volunteer work, and other family commitments. When work responsibilities increase at the same time without room for flexibility, this can cause immense stress due to the pull in opposite directions.

The results of an uneven work-life balance not only affect workers, but they also affect employers. The increasing psychological pressure can lead to burnout, which results in higher stress-related health risks, more absences, and lower productivity. The costs associated with these are passed on to the employer. Burnout can also lead to poor interpersonal relationships between employees and supervisors, reducing job satisfaction throughout the workplace.

An important contributor to the difficulty of maintaining a work-life balance is the change in how and where employees are expected to work. As technology advances and globalization becomes more popular, employees can work from just about anywhere with the help of smart phones, laptops, and tablets. They can access emails and assignments 24/7, meaning that they are increasingly available to employees and supervisors, and that work is becoming more fast-paced as time goes on. This accessibility has its benefits, but it can also make it difficult to maintain proper boundaries outside of work hours.

Offering a setup that fosters a good work-life balance wholly benefits both the employer and employee. This setup can include flexible job roles, which can help workers design their work routine to fit their personal commitments. Flexible working options include compressed work weeks, job sharing, and allowing employees to work from home when possible. Supervisors can aid in this by encouraging staff to use their accrued leave and reminding them to not respond to work-related contact during non-working hours.

A worker’s satisfaction in both their work and personal life greatly contributes to their success as an employee, and this directly benefits any company they may work for. Helping workers to maintain a healthy work-life balance increases loyalty to their employer and helps employers achieve a lower turnover rate. Companies that recognize the importance of a proper balance (and implement policies to encourage them) will see increased productivity and retention of staff. If employees don’t view work as a dreaded chore, they will work more diligently, make fewer mistakes, and become advocates for the company.

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Just because you’ve made the hire doesn’t necessarily mean you’ve got a new employee. New IT hires are free to walk away at any moment before they actually sign your offer letter – and they may choose to walk away soon afterward. A recent Bersin by Deloitte study found that a full 22 percent of employee turnover occurs during the first 45 days on the job – sometimes because the new employee accepts a counteroffer; but more often, simply because they didn’t feel welcome.

In the time between this moment and that turnover, you may be wasting valuable time and resources preparing the new employees tax and legal paperwork, putting together a first-day briefing, and failing to arrange a backup plan.

But preboarding – preparation for onboarding – achieves a lot more than just keeping your new hire at their desk. When done right, it can also help reduce first-day jitters, start the relationship off on the right foot, and make sure your new employee is ready to hit the ground running. Here are a few practical tips for creating a preboarding process that makes your new IT hires feel like part of the family, right from the start.

Establish rapport right away.
Recruiters agree that direct face-to-face is one of the most powerful tools for reinforcing a relationship with a new hire. Schedule low-pressure meetings offsite – grab a coffee one day, then treat your new hire to a nice lunch later that week. You might even consider bringing them into the office on a weekend, when no one else is around, just to get them used to the environment. If it’s tough to schedule in-person meetings, call your new hire – or, better yet, video-call them – every few days, just to check in and chat.

Along the way, look for opportunities to organically bring up your excitement about having your new hire on board. Mention the cutting-edge technology they’ll get to play with, and the fun activities you’ve got scheduled over the next few months, and the interests and hobbies they’ve got in common with other people on their team. Get an ongoing conversation going, and make them feel like they’re already part of the crew. Consider assigning them a specific mentor at the office.

Counteract those first-day fears.
As I mentioned in the intro, the vast majority of IT hires who walk away from a new job do so because they fear some kind of problem. Maybe their family doesn’t want to relocate, or a recruiter warns them they’ll miss out on better offers, or – most common of all – they get their first look at the workload and decide it’s above their pay grade. It’s your job to counteract these fears, and prepare your new hire to stroll in with supreme confidence on their first day.

You can provide your new hire with confidence in a wide range of ways. One of the simplest is to set them up with a company email account – and even a company computer, if possible. A lot of companies also provide new hires with a “Day 1 Survival Kit,” including company swag like a coffee mug and notebook, a stack of business cards, a map of the local area, and some coupons for nearby eateries. None of this stuff needs to be expensive – its purpose is to demonstrate that you care.

On a more practical level, prepare an informational packet with basic info on the company, links to useful reference websites, contact info for team members, a walkthrough of day-to-day schedules, and a briefing on the specific activities they’ll be expected to perform in their first week on the job. This not only makes the new hire feel like part of the team – it also ensures they’ll become an effective team member as quickly as possible.

Make sure they sign – and that everyone knows it.
Never settle for just a verbal acceptance. Get the new hire’s signature on the dotted line, pronto. The simple act of signing an offer letter often does a lot to raise a new hire’s level of commitment – especially if it’s done in your presence. You might also consider getting your new IT hire to formally sign up for some training courses or other enrichment activities during their first months on the job.

You might even call the new hire’s references – thank them for their help, let them know your offer’s been accepted, and encourage them to call and congratulate your new hire. All these things reinforce the reality of the new hire’s decision, while (if necessary) subtly upping the social pressure not to back out.

A recent survey by Succeed@IBM found that new hires who go through preboarding are 80 percent less likely to leave their jobs during their first year. So above all, reinforce your new hire’s acceptance decision with lots of encouragement. Congratulate them on having made the right choice.

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