Concerns about a looming recession have not derailed the booming IT job market. In the first half of this year, 115,000 new IT jobs were added, according to consulting firm Janco Associates. Even with inflation, high energy costs, and the invasion of Ukraine, IT hiring continued at a record-setting pace, but keeping tech talent still poses challenges. IT salaries for existing IT staff and middle managers increased by just under 3%, while new hires were paid 5% to 6% more than existing staff, raising the appeal for some to switch jobs.
If that weren’t enough to keep IT leaders on edge, a crop of new forces — from Supreme Court rulings to climate change, four-day workweeks, and office face time — are poised to impact where tech employees choose to work and for how long they stay. These industry-watchers have identified five forces influencing the IT work landscape.
1. The shifting dynamics of the workday — and workweek
CIOs spent the past two years accommodating hybrid-work arrangements with employees to keep them onboard. Today, the conversation has turned to when they work and the number of hours required, says Brian Kropp, vice president of human-resources research for advisory firm Gartner. This question comes as companies embrace employees’ mental well-being and ask whether the 45-hour workweek is the most productive and healthiest way to work.
“We’re already starting to see employees blurring their day. It’s not 8:30-5:30; it’s a couple hours in the morning, a couple hours in the afternoon, and a couple hours at night. Or some people are starting their day at 10 and working until 7, or 6 to 2,” Kropp says.
Organizations are also considering relaxing the 40-hour workweek. “There’s a lot of talk about a 32-hour (or four-day) workweek, but that’s still a relatively small number of companies, maybe 5%,” Kropp says.
The movement could pick up steam though when companies run out of ways to incentivize people to join their labor force, says Arran Stewart, co-founder of recruitment platform Job.com. “If I can’t pay them more money or give them more free gym memberships or daycare, then all I have is another day off — especially in the IT market where a lot of the work is based on deliverables or performance.”
Most companies are mulling more flexible options, such as offering 10 more days of paid time off, or designating the first Friday of the month as a companywide day off or mental health day, Kropp says.
2. The increasing impact of political and social issues on retention and hiring
Some 70% of employees expect their employer to take a stance on social and political events going on in the world, according to a Gartner survey.
The CEO at a global financial services firm fielded 30 calls from his senior female VPs over one weekend after the Supreme Court overturned Roe v. Wade asking him if the firm was going to take a public stance. “He’s under a lot of internal pressure,” says David Dotlich, president and senior client partner at Korn Ferry, who spoke to the firm’s leader. “I talk to CEOs who feel caught sometimes between what our workers are saying to us and what we want to say publicly. In the tech area they are definitely slanting it toward the worker and what do we do to keep the workers happy. In the consumer area, they’re more nuanced.”
By June 30, 45% of employers had either made a statement or were planning to make a statement about the Supreme Court ruling, Gartner’s Kropp says.
Tech workers, especially younger employees, also want their companies to take a stance on climate change. Almost half of Gen Zs (48%) and millennials (43%) say they have put some pressure on their employer to act on climate change, according to a Deloitte survey, and two-thirds (65%) of leaders are feeling pressure from their employees to act.
Those who are the most vocal on this issue, and feel their employers are listening and incorporating their feedback, are also more loyal. This suggests there is a mutual long-term benefit for employers to listen and act. But taking a stance (or not) often leads to a no-win situation.
“Regardless of political affiliations, when an employer doesn’t say anything, you assume that they agree with the other side. So by not saying anything you alienate everybody. But also by saying things, you also alienate somebody,” Kropp says.
He advises companies to establish core values for the company before situations arise so that leaders can reference them when deciding whether and how to respond to these political and social issues. “If you explain that a decision was based upon the values you have as an organization, the vast majority of employees will be accepting of it,” he says.
3. The (complicated) return of in-office career perks
While remote workers have proved to be as efficient and often more productive than workers in an office, managers perceive remote work differently. Some 64% of managers surveyed by Gartner believe on-site employees are higher performers, and 76% of managers believe on-site employees are more likely to be promoted.
“I think there is more visibility and so you just know people better and are more comfortable with their performance,” Korn Ferry’s Dotlich says. “You do need to be in the office some percentage of the time just because you gain access to networks of information, you have informal conversations, you have innovation that comes from unplanned encounters, just a whole lot of access to the culture and the informal network. But you don’t have to be there all the time.”
But without intervention, this unconscious bias will erode what is trying to be accomplished with equity, Kropp says. When workers were surveyed on their work preferences, 8% more women than men want to work from home, often for childcare and other family-related reasons. “If we do nothing, our diversity, equity, and inclusion efforts will worsen” in terms of the gender wage gap and a less diverse leadership pipeline, he says.
4. The company as an internal marketplace for skills
Internal skills marketplaces are emerging as a means for retaining tech workers while also meeting demands for agile digital environments.
Millennial tech workers, for example, often report feeling “trapped in the org chart” with a predefined job description that limits their work, says Jonathan Pearce, workforce strategies lead at Deloitte Consulting. The feeling is, “it would be easier to keep growing my career if I look outside the organization rather than inside. There’s no opportunity to put my skill sets out on the table,” Pearce explains.
Meanwhile, project managers need to connect work that needs to be done with the right set of skills, some of which might come from a subfunction of IT. Internal skills marketplaces meet both needs by matching workers’ skill sets, not their job titles, with the work that needs to be done.
“We see huge investment going into this in terms of AI-driven skills management platforms … to match people’s skills in a more dynamic way,” Pearce says.
Consumer goods company Unilever used its internal talent marketplace, FLEX Experiences, to redeploy more than 8,000 employees during the pandemic and unlocked 300,000 hours of employee work.
An internal talent marketplace can also reduce internal hiring bias and increase networking that promotes diversity. Hiring managers can focus just on skill sets and years of experience rather than education by removing that visible field, for instance. Others use the platform to build mentorship relationships that are senior-to-junior, junior-to-senior, peer-to-peer, and expert-to-novice, which breaks down taboos in relationships, connects people globally, and facilitates meaningful work and retention.
5. Leaders as orchestrators of complex team environments
Organizations are realizing that hybrid work is more about how teams come together — not just what’s right for the organization or individual, Pearce says. So more companies are ratcheting up expectations for their team leaders to decide how work gets done, and then hold them accountable as a team when it comes to performance and rewards.
“We’re expecting more team leaders to have open discussions with their teams on what’s working and not working around communication, the norms around [how quickly] they’re expected to respond, and how we come together when we need to collaborate,” Pearce says. “The question now becomes how do we up their game as managers — not just managers of work but really orchestrators of a more complex team environment.”
Good managers make work more enjoyable for their teams and are better able to identify and use each employee’s strengths. Moreover, they can also help those workers gain the skills and experience they need to develop their careers. All three of these factors are key ingredients for employee retention.
Pearce points to one client that was looking at separating out the roles of the work manager and the people manager. “Not that it was a better construct as much as it was a recognition that we really need to prepare managers to be operating as people managers … with those soft skills of leadership, especially in technical roles,” Pearce says.