Despite the on-going uncertainty as the UK triggers Brexit proceedings, IT employees remain in high demand as rapid developments in IT are increasingly causing companies to experience wider skills gaps that they are struggling to fill. At 21%, IT and digital skills were cited as one of the top three skills most needed by organisations to achieve their business objectives this year.
IT professionals in cloud infrastructure, projects and change management, development and security saw the biggest salary increases last year of over 2%, however almost half of IT employees were dissatisfied with their rate of pay this year.
Aside from salary, our Hays Salary & Recruiting Trends Guide 2017 also revealed that staff in the IT sector are truly doubting career prospects, despite demand heightening and nearly three-quarters of employers saying they would be continuing to recruit this year.
Career progression doubts
Half of employees said they felt there is no opportunity for progression in their organisation, resulting in only 51% saying they were positive about their career prospects this year. It’s a worrying statistic, due to the scale of the skills gap within the sector. Employers need to get creative about developing transparent career paths for IT professionals in addition to making progress towards attracting people to the profession.
If career prospects aren’t improved, IT employers risk losing talented individuals as 60% of IT staff said they plan to move jobs in the next year. Despite this, IT employers do recognise the significance of good career progression paths when attracting talent, as over a quarter (27%) rated this as the most important aspect when recruiting.
Looking to which generation is most unhappy with their career prospects, Generation X are most likely to move roles as two-thirds said they would consider moving within the next year (66%). Only 42% of the generation said they felt there was scope for career progression within their current organisation, and as a result only half were positive about their career prospects going forward.
Women in IT placed more importance on career development when looking for a new role as over a quarter said this was important (26%) compared to 23% of men. Both genders reported similar outlooks for their career prospects this year, as 52% of women said they were positive about their career prospects alongside 51% of men.
Skills gaps exacerbated
The skills gap will continue to be the primary issue facing the IT sector throughout 2017 and with more people likely to move jobs, the retention of staff will become a growing issue as demand for specialist digital skills increases. 81% of IT employers cited a shortage of suitable applicants as their key recruitment challenge this year, followed by competition from other employers (42%).
Employers will need to think long term, about how they will identify, target and secure the skills they need. Unrealistic salary expectations from professionals will also become a challenge and employers will need to expand their benefits packages and provide clearer career paths to attract and retain staff as they look to build their teams to enable long term growth. Employees are clearly unsatisfied with career progression in the sector, so we advise employers to make it clear for new recruits and existing employees, what steps they can take to progress further.
Interestingly, following the latest budget announcement, ‘T-Levels’ are planned to be introduced in the autumn as a grassroots investment into skill short sectors. These are technical qualifications providing skills based courses on engineering, digital, manufacturing, business, hospitality, construction and social care. The development will no doubt improve the acute skills gaps within these professions, and it’s particularly encouraging that the digital sector will be included. The planned learning route for the digital T-Level will be broken down into occupational areas of IT support and services; software and applications design and development; data and digital business services.
Employees tempted to move as salary pressure increases
Retention of talented IT employees will become more prevalent this year, as employees are tempted by salary and benefit packages on offer elsewhere. A quarter of IT employees said salary or benefits packages would be one of the top reasons why they would leave their role. Additionally, nearly half of IT employers said competition from other employers would be an issue when recruiting (42%).
Roles in demand, where employees can expect to receive high salaries, in addition to good opportunities, include transformation, cloud, data & advanced analytics, cyber security and development. With customers wanting constant, on-demand access to products and services, organisations across a number of sectors are investing heavily in digital transformation.
Employers are concerned that demand will inflate salaries, and lead to unrealistic salary expectations from staff, of which 40% of employers said this would be a challenge when recruiting this year. Many IT employers did increase salaries last year, at 63%, with 13% increasing salaries above 5%. Additionally, over two-thirds (71%) plan on increasing salaries this year.
With this in mind, it’s predicted overall salaries for IT employees will rise to above the average seen this year of 1.8%.
Steps for employers to attract and retain staff
As we navigate a changing and demanding marketplace, here are three steps for IT employers to take to ensure retention of good staff, as well as attracting new talent:
Flexible working options are a necessity: The IT sector does allow for flexible working initiatives due to the nature of the work, however employers should place further importance upon their flexible working processes as over three-quarters rated it as one of the most important benefits when looking for a new role. Options for employers to incorporate into their workforces include; part-time working, flexi time and remote working.
Support and promote career progression: There is still a vast amount of work to be done to bridge the skills gap within the IT sector. In the meantime, whilst 60% of IT professionals are thinking of moving jobs this year, employers should upskill and support their staff to encourage career progression.
Review salaries and refresh benefits: Whilst not all employees are currently satisfied with their salaries, 71% of IT employers do plan on raising them this year which is encouraging. In turn, if employers can’t raise salaries above expectations, it’s recommended to at least review benefits packages to make sure they appeal to prospective candidates and current staff.
James Milligan, Managing Director of Hays IT
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