Looking at recent news headlines and monthly employment data from the U.S. Bureau of Labor Statistics paints a potentially confusing picture. Stories of significant gains in jobs across the country seem to contradict accounts of layoffs at Big Tech companies. So, what’s actually happening in the technology hiring market?
In short, a lot. Yes, multiple Big Tech companies are letting large numbers of employees go, but these layoffs don’t tell the whole story. A considerable amount of eliminated roles were in departments outside of IT, and many of these firms are still adding staff. When we look across industries, technology professionals are highly sought after, as almost all companies need their skills to operate and compete in today’s digital-first world. The U.S. labor market remains strong overall, and the unemployment rate for technology professionals is lower than the national rate, indicating solid demand – and competition – for technology talent.
Taking a look at companies’ hiring plans in the latest Demand for Skilled Talent report from Robert Half sheds more light on the technology job market and what to expect in the coming months. Spoiler alert: Hiring is likely to stay highly competitive through the first half of the year.
Technology hiring is set to speed up
Research in the report shows 64% of U.S. technology hiring managers at companies across industries plan to expand their teams in the first half of 2023. That’s up eight percentage points from the second half of 2022, when 56% said they were planning to hire new employees before the end of last year. Another 32% of technology hiring managers said they are hiring for vacated roles before the end of June.
It’s evident hiring for technology professionals is a priority for the majority of the companies surveyed, but it remains difficult to recruit top candidates. Ninety-one percent of IT managers reported challenges finding skilled IT professionals.
Tech hiring managers look to shift strategies
While technology managers are clear about their plans to add staff, they’re indicating a potential shift in how they’ll do so.
Among all technology hiring managers surveyed, 72% said they plan to increase their use of contract talent in the first half of the year — up 12 percentage points from the second half of last year. Software and applications development; security, privacy and compliance; and technology process automation are key hiring areas indicated for contract IT professionals.
This flexible staffing approach allows organizations to scale headcount as needed, keeping more tech workers on board when required for bigger projects and fewer during slower times — without having to cut permanent staff.
Technology professionals remain in high demand
Companies need talent for various initiatives, including software and applications development, cloud services, cybersecurity and data privacy, and web and mobile development and design. Research from the Demand for Skilled Talent report identified these technology and IT professionals as the most highly sought:
- Systems analysts
- Network architects
- Information systems managers
- Web developers
- Database administrators
- Information security analysts
Recruiting skilled candidates for these roles remains challenging. Waiting to hire, while thinking the tech labor market will soon loosen up, could be a costly hiring strategy for companies as they watch the best available candidates get swooped up by other firms.
What are tech professionals looking for?
According to Robert Half research, 52% of technology and IT professionals are looking or plan to look for a new job in the first half of 2023. Knowing what these workers want most can give hiring managers an advantage in landing top talent — or retaining the professionals they have.
Not surprisingly, flexible work options, including remote work, are high on the list. Among those with plans to find a new opportunity, half said they’re interested in a fully remote position with no expectation of regularly working in an office setting. And 61% would consider a hybrid role, working in-office some days and elsewhere other days. Less than one-third (28%) said they’re interested in working fully in-office. (Multiple responses were allowed.)
The “Now Hiring” signs for technology roles are decidedly up — even as some of the same companies that promote open roles online are still announcing layoffs. The tight hiring market isn’t over yet, and successfully recruiting top tech talent doesn’t look to get any easier. If you’re adding staff to your IT department, having a streamlined hiring process and competitive offer will be the most effective approach to bringing top candidates on board.
