The Information Technology sector is enduring a hiring crisis fueled by ever-increasing demand and significant decrease in computer education enrollment. As these issues continue to develop, you need to ensure that you have the best possible plan to be competitive in hiring and keeping the best IT professionals.
The current hiring crisis in Information Technology is a function of ever-increasing demand as well as a startling decrease in computer education enrollment, and is threatening the industry with serious labor shortages.
Add in issues like the scarcity of H-1B visas for immigrant worker programs, and you end up with Bill Gates pleading before the House of Representatives Science and Technology Committee on March 12, 2008:
"We provide the world's best universities ... and the students are not allowed to stay and work in the country. The fact is, [other countries'] smartest people want to come here and that's a huge advantage to us, and in a sense we're turning them away."
Immigration politics aside, the growth of IT jobs continues in an economy beleaguered by fears of recession. Industry surveys show that 13 percent of CIOs will add staff in the first quarter of 2008, while only 3 percent intend to cut back. While the overall unemployment rate in the country remains around 4.5 percent, unemployment for IT specialists is alarmingly near to none. Windows Server administrators are in the greatest demand at present, and the unemployment rate for those individuals is below 3 percent, according to the U.S. Bureau of Labor Statistics. The fastest-growing need is for network specialists, and their rate of unemployment is 1 percent.
Total employment in IT is expected to grow from 3.5 million to 4.0 million by the end of the decade. 2010 is also the year in which increases in the 65 and older age group are forecasted to finally overtake increases in the 20-64 age group. Retirement of baby boomers will significantly impact the availability of seasoned – or at least salty - IT professionals.
The grimmest news we've saved for last. The Computing Research Association is an association of over 200 North American academic departments of computer science, computer engineering, and related fields. Annually they survey new enrollments, declarations of major, and graduations in their fields of interest. They have found that enrollments have declined steadily from a peak of 57,000 during the 2000/2001 academic year to 30,000 in 2006/2007. The number of Americans pursuing core computer degrees has dropped by half over a six-year period.
Those are difficult numbers to digest, and while they don't tell the entire story, they do provide a framework for understanding the breathtaking magnitude of the problem. We are also beginning to see specific workplace changes.
Per hour wages for hourly computer technicians were flat in November of 2007 from the same period in 2006, but hours worked leapt by 12 percent. While overtime hours have traditionally been a sign of a prosperous work life, we are beginning to see indications that unplanned work hours can create negative quality of work life issues that are every bit as important to the worker as the wage itself.
The decline in IT career interest has no clear cause. Because the decline began in the early 2000s, it would be natural to blame the tech boom and the subsequent bust in the late 1990s.
Parents working in technology during that period were not likely encouraging their teenage children to follow their path. It's easy and probably correct to blame the educational system for failing to encourage an interest in science. Computers themselves have lost some of their novelty and appeal, and once the sexiness of technology is lost, all that is left is the geek factor. Computers may also seem dull and earthbound compared to the iPhone and whatever gadget is coming next.
The short and long-term problems with the structure of employment in IT affect everyone. You can do your part as an employer by taking a more active role in industry organizations. Every trade association has development and outreach programs, and IT organizations have a clear need to develop more and reach farther.
On a local level you can reach out to high schools and colleges to offer internships or part-time work. Hiring students gives you extra hands on deck when you need them, allows you to make a great impression on students before they graduate, and gives the students on-the-job experience so they are better trained when they enter the work force.
Technology companies need to invest now to avert the coming labor shortage by getting involved with area schools. Public and private schools always need additional funding for science education. Foundations like the Oppenheimer Family Foundation in Chicago fund project-based learning through individual teachers in the Chicago Public Schools via their Web site at www.offtig.org. Each summer, teachers propose specific classroom activities that are funded during the school year by the foundation.
Your company can fund similar projects in conjunction with local schools, but you must make the required effort. The contribution to the overall cause of getting kids into science is important, and you will likely receive tremendous public relations support. Most importantly, you will set an example for others.
Increasingly competitive hiring and retention of quality employees presents another hurdle for employers. It is important to review your current employment policies and procedures to make sure that you are taking employee needs and industry trends into account. This isn't the most exciting activity to undertake, but it pays off when you consider that it is much more economical to retain good individuals than it is to go out and find them.
Have an actual retention plan. When people leave, find out why, and don't accept the first answer, because it is often the old smoke screen, "It's not you, it's me."
If an employee's reason really is because of a problem with a boss, consider what happens with a baseball team. It isn't the players who get fired.
If departing employees complain of a lack of career advancement, ask yourself if there is a plan in place for each employee. Do you adjust when the plan isn't working?
If an employee's commute is oppressive or if family issues present a problem, is flex time or telecommuting a possibility?
Do you regularly review your salary structure to make sure that compensation is up to date? People do move for marginally more money, especially if the grass also looks greener in other areas of the company.
Do you invest in your employees? Skill upgrades are a major issue in IT since technology changes often happen haphazardly. Retraining and cross training help the enterprise on two levels: they build currency, depth, and flexibility in the organization, and they build a sense of commitment and belonging within the employee.
From a marketing point of view, employment is like any other aspect of your business - it requires innovation. If employment is a product that you sell to talented individuals, consider how you can more effectively market yourself to them. Do your hiring ads talk more about the benefits of products that you sell than about the benefits that you can offer to potential employees? If so, you are making a costly mistake. As an employer, you must find ways to differentiate yourself from the competition.
Create a marketing plan for hiring, if you don't have one already. Throwing money at potential employees to attract them to your company is lazy and ineffective. Salary and standard benefit packages are increasingly becoming a commodity. Employees today are looking for companies with a differentiating factor.
Employees demand more flexibility and freedom today because more is expected of them. Organizations want them from 9 to 5, but we also want them – especially IT personnel – in off hours during times of crisis or emergency. With the Internet and mobile phones past tipping point levels of penetration, we all feel connected – and often compelled - to work at any hour of every day. We take calls on the weekend and we answer email before we go to bed at night and before we depart for the office in the morning. This shifting sense of work time is something new, and represents a major change in the work day or work week paradigm as it makes its way into various levels of the organization. The challenge for employers is to rebalance the time needs of the organization with those of the individual in order to maintain a sense of fairness.
The idea of telecommuting has seen one heyday and is due for another. The old way of telecommuting involved a wired phone, fax machine, and email in a spare room of an employee's home. There was rarely a sense of complete involvement and availability, and valuable face time was unavailable on both sides.
Today, technology has changed everything. A revolution in network communications systems is rapidly moving voice and data from legacy phone networks to Internet Protocol (IP) networks, and entire industries exist to converge and transfer data, voice, and multimedia at speeds that strive for and often reach immediacy. Large-screen, high-resolution monitors and video cams over speedy networks make us vividly available to one another at very low costs. Not only will telecommuting not be a problem in the near future, but there won't be much reason to go up to the third floor to sit in someone's office, either.
This new technology has several advantages. The cost savings that we have been seeking from network technology is finally arriving. Services are also converging, so you no longer need to separate suppliers and maintenance for phone and fax and email and video - it all passes through the same system.
While management issues of policy and fairness will complicate this process until there is more experience with it, the benefits for the company and the individual are manifest. The company now has a valuable benefit to offer to current and prospective employees, and since those benefits are real, the morale and productivity of the workforce will marginally or substantially improve. For the employee who dreads the hour commute each way or the cost of gasoline, a day or two (or three) each week at home involves more time sleeping or working rather than traveling, as well as flex time for child care, elder care, or attending kids' soccer games. The technology exists to make this happen. If your idea of Voice over Internet Protocol (VoIP) technology is a consumer product like Skype or Vonage, you underestimate the power of the new enterprise IP networks to deliver voice, data, and media in the most immediate and vivid ways.
The availability of these tools do not make the larger IT hiring crisis go away, but do better equip employers to deal with this crisis from a new angle.
Supply and demand issues are also top of mind for employers. It may seem that you need to be in the Silicon Valley to find and attract the best pool of talent, but the exact opposite may actually be true. Competition for top talent in that area is fierce, and while companies in San Jose may appear to be taking all of the prized recruits, they often are poaching employees from one another. Employment growth at upstarts like VMWare is stunning, and stalwarts like Cisco, Yahoo, and Oracle have size, might, and strong recruiting cultures.
On March 24, 2008, VMWare announced that it was investing $100 million in new research and development efforts in Bangalore, India. It's a fair assumption that the choice of India as a location has to do not only with their customer base there, but also with the availability of IT professionals, some of whom may have been U.S. educated.
Google, the biggest hiring beast of all, brought in 2,130 new employees in the third quarter of 2007 alone, bringing their total number of employees to around 16,000. While this kind of employment growth may seem impossible to manage, it is needed to support their business and revenue growth.
The market in your geographical area may be more reasonable, and while you still need to compete for the people and skills you need, you needn't get caught up in the Silicon Valley drama that gets played out in the media.
Google may be the paradigm, but just because you don't have their resources doesn't mean you can't find a way to emulate some of their practices. By employing similar practices, you may mirror some of their results.
One way to emulate Google's hiring practices is to take a closer look at your own hiring process. Traditional hiring practices at Google resulted in six to eight separate interviews per applicant. General Electric veteran Laszlo Bock was brought in during 2006 and within six months the number of interviews per hire fell to 5.1 on average. You may not be conducting five interviews now, but if you conduct four interviews you might want to consider the benefits of getting to three. These benefits may include getting a better reputation for hiring practices among potential recruits. If the word in blogs or over beers is that your process is lengthy and tedious, you aren't competing effectively. Fewer individual interviews increase your ability to process more applicants during the peak spring hiring period for new grads. You may also save money and time that you can spend in other parts of your recruiting program.
Labor shortages in important functions like IT demand a critical look at all aspects of employment practice in order for employers to achieve cutting-edge results in the race for quality IT employees.
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