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Tech Sector Is Rocky Recruiting Terrain
Recent spate of mass layoffs hasn’t eased tight competition for industry talent

By Theresa Minton-Eversole  8/11/2014

Some observers might use the word “tumultuous” to describe the state of staffing in the IT sector, which is still reeling from announcements at Microsoft and Hewlett-Packard of impending downsizings.

In July the sector recorded a 49 percent increase in job cuts from June, making July’s layoff total the second highest of the year, according to a report released July 31, 2014, by global outplacement firm Challenger, Gray & Christmas Inc.

Overall, cuts in the technology sector are well ahead of last year’s pace. The total number of cuts by U.S. employers was 24 percent higher than the cuts recorded in July 2013. In fact, through the first half of 2014, employers in the technology sector announced plans to cut payrolls by 48,402—68 percent more than the announced layoffs in the first six months of 2013 and nearly surpassing the approximately 57,000 job cuts recorded in all of 2013, according to Challenger.

“Oddly, the rise in technology sector job cuts is occurring at a time when the economy is finally starting to regain some of its former glory,” said John A. Challenger, the outplacement firm’s chief executive officer, in a press statement. “Many of the job cuts we are seeing are more indicative of an industry in transition than of one in decline.”

Furthermore, “tech jobs going forward will not necessarily be confined to technology firms; the biggest growth will be in industries such as health care, manufacturing, automotive and retail,” he said. “The fact is, these are companies that are trying to adjust to where the growth is occurring.”

Consequently, experts say tech staffing continues to be a chaotic business of finding—and retaining—the best talent.

Combatting Recruiting, Retention Difficulties

Many employers are having difficulty finding technology workers with in-demand skills, according to respondents to Computerworld’s 2014 IT Salary Survey.

For the third year in a row, application development was the most sought-after skill, with 49 percent of responding managers reporting they plan to hire an application developer this year. In addition, 44 percent of respondents said they plan to fill help desk and IT support positions this year—up from 37 percent in 2013 and the biggest year-over-year survey increase.

Many employers also are looking for IT professionals with business acumen and data analysis competence. But expecting job applicants to have that broad an array of skills is affecting how quickly recruiters can fill open positions. Half of the survey respondents said that it has taken at least three months to fill open IT positions in the last two years.

“Given the shortage of talent, companies must adopt a strategy of building tech talent from within,” said Steve Cadigan, founder and CEO of San Francisco-based talent strategies advisory firm Cadigan Talent Ventures LLC, in an interview with SHRM Online. “If they only hire experienced [professionals], their time-to-fill will be quite long. If they instead focus on a balance of experienced and new grads and interns, they can grow talent versus just having to buy it. You must find talent that is agile and can learn and adapt and develop.”

The slower time to fill vacancies also is having a negative impact on current workers in many companies, leading to retention problems, according to Computerworld’s survey.

“If you have a large need for tech talent, no number of recruiters will solve your dilemma,” said Cadigan. “Success in recruiting tech talent stems from a full company commitment to sourcing and hiring the best, and this goes way beyond recruiter activities and efforts.”

Cadigan, formerly vice president of talent at LinkedIn, said the social networking site reported recruiting efforts for tech workers to the whole organization every other week, “so we could track our progress, hold ourselves accountable and see where we needed to improve our flow and practices.”

As for combatting low engagement, he said that the best way to engage a tech team is to keep ensuring they are working on complex challenges with great tools and resources and surrounded by great peers who are working on something that matters.

“To me this is a question of priority and culture,” he said. “Tech talent, like most talent, wants [to be] told how much the company values their contributions and wants to know that the work they are doing matters, makes a difference and solves important problems. This goes beyond compensation and benefits; it gets to leadership and culture, and how you set up the relationships [among] tech talent [and others] in your company.”

Theresa Minton-Eversole is editor/manager for SHRM Online.

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