With demand for technology talent increasing and IT facing competition for the best people from vendors, startups, and even other functions within their own companies, a tight labor market is quickly moving up the list of CIO challenges. They know that the best strategies for digital transformation will amount to nothing if they don’t have the right talent to implement them.
But before IT leaders change their talent strategies, they need to understand what IT employees want and expect from their job. Recent findings from CEB’s Global Talent Monitor reveal three facts about IT staff and the way they think about compensation, job opportunities and personal development (Disclosure: I am employed by CEB).
1. IT staff are flight risks. Employees in IT are more confident than workers in any other function that they could find another job at a different company. Their own sense of worth in the labor market rose by 2 percent in the second half of 2016 to a six-year high. Moreover, nearly one-third of IT professionals reported that they were actively looking for a new job in the last six months of 2016.
Intense competition for IT employees with critical skills and experiences is only expected to continue. And at the same time, the potential for tighter immigration policies in the U.S. and uncertainty surrounding Brexit could also cause shifts in global IT talent markets. Rather than rely on annual talent forecasts linked to project demand, IT leaders should develop a multi-year plan for the skills they expect to need. Central to this plan should be efforts to develop existing staff, as hiring alone will be insufficient given the scale of future demands.
2. IT staff leave for better benefits, but not (much) better salaries. In the second half of 2016, IT employees anticipated a smaller salary increase when taking a new job compared to the previous five years. IT staff in Latin America and North America dropped their expectations most, by 4.6 percent and 1.9 percent respectively. But at the same time, around half of IT employees reported that they were much more likely to switch to a new job if that position came with better non-compensation based benefits, such as better work-life balance or more valuable professional development opportunities.
The more modest expectations for increased base pay indicate that IT leaders should look beyond salary and compensation to attract talent. The most progressive IT leaders prioritize strategies that focus on offering current and prospective employees flexibility, personal growth and engaging work. For example, one leading manufacturer expects all IT managers to have an up-to-date understanding of their employees’ career aspirations. The IT leadership team conducts regular reviews to identify opportunities such as project assignments and rotations that can be used to ensure these aspirations are fulfilled.
3. Current career growth and development offerings fall short. More than 60 percent of IT employees report dissatisfaction with the development opportunities currently available to them. In fact, IT staff report that they are more satisfied with the quality of their compensation, co-workers, company reputation and with the nature of their work than with the quality of their career and personal growth opportunities.
As organizations become flatter and more matrixed, leaders often find that they cannot motivate and retain employees with regular promotions. IT organizations risk losing critical employees and creating talent gaps if they fail to address IT professionals’ desire to build capabilities, experiences and personal attributes that make them more valuable internally and externally. One solution is to develop employee career paths through a series of experiences rather than by climbing a traditional career ladder – for example, moving between different project teams, or trying out roles in different parts of IT or elsewhere in the business. This approach creates employees with more rounded profiles who have a greater number of future career options available to them.
With IT employee confidence in the opportunities created by digitization growing and job-seeking activity rising, the competition for talent is only getting hotter. IT leaders have an opportunity to pave the way in ensuring that roles and experiences are designed around the attributes that matter most to employees. And as technology becomes part of everyone’s job, responding to these facts will ultimately help all functions find the talent they need to succeed in the future.