It’s safe to assume we’ve all noticed how quickly technology is rolling out these days. From artificial intelligence (AI) and Blockchain to data science and DevOps, we’ve seen massive shifts in how most industries operate. However, while all this progress and potential is very exciting, the surge in demand for the specialized skills needed to manage these emerging technologies is also causing a skills gap.
How might this talent shortage impact your business? And what strategies can you use to bridge this gap and attract the specialized talent your organization needs to thrive?
These are the questions we’ll explore in today’s guide, alongside insights from industry experts and our recent webinar: “Hiring global tech talent in a shortage.”
What’s behind the tech skills gap?
According to Robert Half, 95% of tech leaders are finding it difficult to hire skilled talent, and 62% feel the tech skills gap has a greater impact today compared to a year ago. So what’s behind the talent shortage in the tech job market?
Put simply, we’ve seen a huge shift towards specialized skills. Companies need employees with expertise in emerging technologies like Blockchain, AI, DevOps, data science, and cloud computing. Why? Because these technologies are transforming industries and creating new opportunities for growth.
Demand is high, but there simply aren’t enough people offering these skills. Whilst it might be relatively easy to fill a software developer or IT support position, finding professionals with skills in cutting-edge technologies is a much bigger challenge. This is partly down to the niche nature of these roles, as they require highly specialized knowledge and experience. The other key factor is that colleges and training programs often can’t keep up with the fast pace of technology, so there’s a real gap between the skills companies need and the talent that’s out there.
“If you look at the number of people with computer science degrees, there’s actually too much tech talent,” Matt Charney, Editor in Chief at Recruiter.com says, “The real problem is that coding is no longer enough. Companies are no longer just looking for workers who can code, but instead focusing on finding the talent that can help them leverage emerging technologies and grow.”
As new technologies continue to become integral to business, companies will need to develop these skills internally and refine their talent acquisition strategies to attract the specialized talent they need to keep up. Those that don’t, will be left behind in the race to adopt emerging technologies.
4 warning signs your company will be impacted by the technology skills gap
So, what are the warning signs? How do you know if the tech or IT skills gap is starting to impact your business? In this section, we take a closer look.
Delayed technology adoption
One of the most obvious signs of skills gaps is that you’re finding it hard to implement new technologies. In fact, according to Gartner, 64% of IT executives believe the tech skills gap is the most significant barrier to technology adoption.
To take an example, if you’ve done your research and found out that organizations experience, on average, a 20% reduction in operational costs and a 30% increase in inventory turnover after adopting cloud-based solutions, but your current workforce doesn’t have the skills you need to transition to the cloud, then that’s a clear indicator of an issue.
Delayed tech adoption is especially common in areas related to software development and cloud computing according to Pluralsight. We also found that companies are increasingly looking for specialized skills in areas like DevOps and data science in our recent e-book: “Understanding the tech talent evolution.”
Since these fields relate so closely to efficiency and operational agility, companies that don’t attract specialists who can implement and optimize technologies are putting themselves at a huge strategic disadvantage.
Frequent bottlenecks
Another big sign that your tech team is feeling the pressure is if they’re constantly running into bottlenecks. For example, you might notice that certain projects are repeatedly delayed because there just aren’t enough people with the right skills to move things forward.
This often leads to your existing team members having to pick up the slack when they’re probably already stretched too thin. It can also result in slower decision-making because fewer people can weigh in or make the final calls on key projects. And all this can delay product launches, frustrate customers, and harm your brand and reputation.
Prolonged vacancies
If you’ve been trying to fill key tech roles but you just can’t seem to find anyone with the right skills, then it’s a pretty clear sign that you’re feeling the talent shortage pinch. And you’re not alone. Research from Manpower group claims that 77% of companies can’t find the skills they need to execute their business strategies.
Meanwhile, the World Economic Forum’s Future of Jobs Report 2023 highlights that, although demand for specialized roles like data scientists, cloud engineers, AI developers, and DevOps engineers has skyrocketed, many companies find that it can take several months to find qualified candidates.
The biggest problem here is that the longer these roles remain vacant, the more disruptive the impact is on overall operations. Prolonged vacancies slow down organizational growth and make it harder for you to meet your strategic goals. The knock-on effects of this include unsatisfied customers, overworked employees, and even higher turnover rates.
Quality assurance issues
When you don’t have the right talent in quality assurance or software testing, things can quickly go wrong. Bugs slip through, features don’t work as they should, and products don’t deliver on their promises.
According to TechRadar, there is already a shortage of skilled software testers and QA engineers in the U.S. With the rapid pace of technological change, companies are finding it harder than ever to fill these critical roles. As a result, project timelines are stretched, software vulnerabilities go undetected, and the overall quality of products can take a hit.
Difficulty scaling operations
Companies that struggle to hire experts in cloud infrastructure, Blockchain, machine learning, and AI will ultimately find it difficult to grow as these technologies are becoming essential for handling larger operations and engaging with customers at scale. In the words of the World Economic Forum, “Companies now face an urgent choice: go digital, or go bust.”
So, how big is this problem globally? Huge. Businesses everywhere, from startups trying to implement AI to large enterprises delaying critical cloud migrations, are feeling the effects of the talent shortage. In fact, a recent study from Boston Consulting Group found that 74% of companies are struggling to scale their AI efforts.
Strengthen your talent acquisition strategy to avoid skills gaps
Given the above, it’s clear that companies need to adjust their approach to access the tech skills they need. Here we take a look at six essential tech recruitment tips to help you strengthen your talent acquisition strategy and protect your business.
Global skills-based hiring
The first thing you need to do is widen your search. You’re less likely to find all the IT skills you need in small local talent pools or when searching for a specific degree. Plus, according to Edie Goldberg, Future of Work Expert and Chair of the Board for the SHRM Foundation, “The skill sets companies need today are changing so quickly that it is difficult to find people with prior experience.”
This highlights a big challenge: educational programs often can’t keep up with the pace of emerging technologies. As a result, traditional markers of talent, like specific past roles or formal qualifications, are becoming less effective for identifying candidates who can actually meet the demands of the modern job market.
Instead, you should look for individuals who are constantly learning and gaining hands-on experience, whether through passion projects, online courses, or other forms of self-driven education. As our Chief Technology Officer, Hiraash Thawfeek says in our e-book, “Companies are turning to early adapter communities and finding tech talent who are driven by self-interest.” By embracing this mindset, you can unlock a global talent pool that’s full of fresh ideas and untapped potential.
Use an Employer of Record (EOR)
As Thawfeek says, “If you don’t move quickly in global hiring, your talent will go elsewhere.” So, what’s the solution? How can you speed up the process of global hiring when there are so many legal aspects to consider?
The easiest way to source specialized tech talent around the globe without the administrative headache of setting up a local business entity is by using an Employer of Record (EOR). An EOR acts as the legal employer for your international recruits, handling everything related to payroll, benefits, and legal compliance. This helps you gain faster entry into new markets so you can snap up talented global hires before someone else beats you to it.
EORs offer more than faster entry into new job markets, too. For instance, Multiplier’s EOR also generates locally compliant employment contracts, streamlines onboarding, and provides visa support so you can provide a great employee experience from day one.
As Thawfeek highlights, “An EOR is a win-win move because you can avoid risk and hard work, but still source the skills you need.”
Build a blended talent model
Another common strategy you can embrace is implementing a hybrid workforce model that blends freelance talent with full-time employees. For instance, many companies are now hiring freelancers for specific, high-demand roles, especially those in high-growth fields like Blockchain, DevOps, and data science where there is strong demand for both contract and permanent roles. This on-demand approach helps you put the right talent on the right project at the right time.
As Jeff Lam highlights in our recent webinar, “There’s a lot of uncertainty in the market, so it’s hard for companies to predict their budget. If they have a project that requires specialized skills, it’s difficult to know whether the project is enough to satisfy a full-time hire.”
For example, let’s say you need a data scientist to dive into customer analytics for a one-off marketing campaign or a DevOps engineer to streamline your cloud infrastructure for an upcoming product launch. With a blended model, you can bring in freelance experts for these specific tasks on a temporary basis. Once the project is wrapped up, you can evaluate their performance, and if they’re a great fit, transition them into a permanent role.
Upskill & reskill existing employees
You should also invest in growing your internal talent. Offering upskilling and reskilling opportunities to your employees, such as the AWS Certified Solutions Architect for cloud computing, Microsoft Certified: Azure Data Scientist Associate for data science, and the Google Cloud Professional Machine Learning Engineer for machine learning. These certifications will give them the skills they need to take on more technical and strategic roles. And it shouldn’t be too difficult to get your team on board given that close to 70% of workers are willing to learn new skills.
Think about the talent in your organization right now. Is there anyone with glaring potential or an interest in learning new skills? Could you plug any tech skills gaps by training your existing workforce to meet your demands?
Key takeaways
And that’s pretty much it. But before we go, let’s remind ourselves of the key takeaways from today’s post:
- The tech skills gap is not down to a general lack of talent; it’s down to a lack of professionals with the specialized skills that businesses need to get ahead
- Demand is particularly high for specialized skills in areas including AI, DevOps, and Data Science.
- Focusing on skills before location or educational background allows you to pinpoint talent with specialized skills in emerging and non-traditional markets.
- An Employer of Record (EOR) offers the simplest and most efficient solution for global hiring. It takes care of all the tricky stuff, like handling local regulations and managing payroll, so you can focus on bringing in the specialized talent you need to close your tech skills gap and position your company for long-term growth.
