The tech world is staring at a major talent crisis. Despite this, many business leaders are largely unaware of the true extent of the challenge they will face recruiting the talent they need in the near future.
Many make the mistake of seeing a tech talent shortage as just a temporary issue or a short term phase in the economic cycle. People are also distracted by the need to invest in new technologies and are misreading the need to also invest in the people who will work with that technology.
But the reality is, the global demand for tech talent far outstrips supply and this imbalance will continue for the foreseeable future.
By the numbers
The latest Korn Ferry research predicts that global skilled labour shortages could reach 85.2 million workers by 2030. And due to the international nature of the tech industry, this means talent trends in the US, Europe, Asia also directly affect the situation in Australia.
The 2018 Australian Computer Society (ACS) Digital Pulse forecast indicates that in excess of 100,000 tech workers will be needed in Australia in just the next five years. This means Australian tech companies will need to recruit more than 750,000 new skilled tech workers by 2023.
With recent changes to visa rules making sourcing international workers even more difficult, this is an issue that no tech leader can afford to ignore. If they do not fully grasp the looming issue and plan accordingly, they risk leaving themselves, their teams, and their companies poorly positioned to successfully compete for the talent companies need to remain competitive.
What’s causing the talent crunch?
The global tech talent crunch is essentially driven by rapid technological change and skills mismatches. It doesn’t necessarily mean there aren’t workers available for certain roles, it’s just that many workers do not have the skills that organisations really need now and tomorrow.
The Korn Ferry study found that 58% of CEOs said they had not ever faced a significant talent shortage before, meaning there is a wide scale lack of leaders with practical experience in this area.
The problem is also exacerbated by poor long term resource planning. Many tech leaders report that people planning is actually far more challenging than planning for matters involving tangible assets or technology.
In some cases this can be due to a failure to grasp the workplace and role changes that are required in tandem with digital transformations. It can also be related to organisational obstacles where short term revenues and financial pressures prevent managers from being able to invest the time or resources needed to adequately plan organisational talent needs.
If tech companies don’t prioritise workforce planning, they will ultimately find themselves constrained by a skills shortage. Once they inevitably recognise this, due to the lead time required to source quality tech talent, they will be forced to pay ever higher premiums to secure them.
One of the most effective ways for talent planning to be effectively implemented is for business leaders to communicate the financial benefits of proactive rather than reactive resource decision making.
If the tech talent crunch can be clearly quantified and tied to the performance of the business in financial terms, then tech leaders and HR staff can draw attention to the financial impacts of revenue not created by failing to secure talent. The additional costs associated with last minute scrambles for contractors or the additional wage premiums needed to secure talent on short notice can also be highlighted.