For HR professionals across a growing number of industries, keeping up with the most in-demand tech and IT trends can be exhausting. After all, much like technology itself, the most valuable jobs and skills within the IT industry are constantly evolving, as are the organizations adopting these new technologies and skills. This was certainly the observation from last year’s overview of IT workforce trends, and it seems to be the case going into 2019 as well.
This overview of Mercer’s latest IT survey findings sheds light on even more recent trends with the related job market, as well as top tech skills and other factors reshaping the way organizations address their workforce needs. Within a job market so closely defined by an unpredictable future, keeping tabs on these ever-shifting trends will ensure that your organization is positioned for long-term success.
High-Level Decision Makers See Value in Digital
While last year was marked by more uncertainty regarding how key decision makers should adapt to such widespread technological changes, this year’s Mercer/Gartner IT Jobs & Skills Survey and US MBD: Mercer Benchmark Database Survey indicated that many organizations are now addressing the issue head-on.
Embracing Transformational Technologies for the Future
The most recent Mercer/Gartner industry surveys showed that the adoption of digital technologies are beginning to matter more to high-level decision makers, regardless of the industries they operate within. In fact, 64% of surveyed business leaders said they now have some sort of management initiative or transformational program in place that aims to help their businesses and employees better acclimate to workplace digitization.
Meanwhile, 43% of surveyed business leaders said they anticipate a high degree of change in the capabilities they’ll need to transform their business model in the future (in this case, “business model” is an umbrella term used to encompass everything from technology to company culture to the actual workforce).
Low Unemployment, High Competition
As far as the present is concerned, the low rates of tech-related unemployment throughout North America are quite telling. Specifically, they speak to how truly in-demand these IT talent and skills are, as well as how quickly employers will hire individuals possessing these skills once they become available.
Here’s a look at some industry survey findings related to tech and IT unemployment rates:
- In the US, the unemployment rate for tech-related jobs was only 2.0% in the first quarter of 2018. Meanwhile, the overall unemployment rate was 3.9% for the same time frame within the country.
- In 2017 the unemployment rate in Canada for tech-related jobs was only 2.6% compared to a 6.5% national average.
Tech Recruiting Difficulties
Directly related to these low unemployment rates, companies are continuing to experience difficulty in finding and recruiting relevant IT skills. And while organizations are still spending more time filling IT job vacancies compared to how much time they spend filling vacancies for other jobs, the latest Mercer/Gartner IT data shows that this gap is closing.
- In Canada, for example, the latest IT survey data shows that the average amount of time it took to fill IT jobs decreased from 3.8 months to 3.5 months.
- In the US, it took an average of 3.3 months to fill open IT positions, also a slight decrease from the previous reporting period.
Despite the fact that the time it takes to fill vacancies for IT jobs is lessening, organizations in both the US and Canada are still finding many of these jobs and skills very difficult to recruit. IT Solution Architecture and Enterprise Architecture both sit among the top five most difficult jobs to recruit for both the US and Canada. It’s also worth noting that, in both the US and Canada, architecture skills overall (e.g., application, data, infrastructure, security) were ranked as the most difficult skill to recruit.
Naturally, all of this presents an issue for HR professionals tasked with attracting and retaining the talent to fill new positions and vacancies. After all, if you need more tech-savvy employees, it’s going to be hard to find, let alone recruit, them if they’re all already working!
AI, Cloud Technology, and IoT: Much More Than Buzzwords!
Industry survey results indicated that more CEOs are further recognizing the value in various tech applications, including artificial intelligence (AI), Cloud/API platforms, and the Internet of things (IoT). Many survey participants strongly suggested that they believe the myriad opportunities made possible by these technologies can and will offer breakthrough potential in the years to come, whether for the delivery of products, services, customer experiences, or any number of other business imperatives.
Still, as a growing number of CEOs and other high-level decision makers attempt to drive deeper transformational change, the demand for tech-oriented skills will grow greater and greater — a fact that has already been hinted at in the data discussed above. As a result, the already intense battle for tech skills related to AI, cloud technology, and IoT will surely continue to intensify, and in many ways it already has.
Regarding ongoing AI, cloud tech, and IoT trends, here are some of the Mercer/Gartner IT survey’s most striking findings:
- Organizations throughout North America listed Artificial Intelligence and Advanced Machine Learning skills as some of the most difficult to find and recruit in 2018. In fact, for the US and Canada combined, these skills saw one of the biggest year-over-year increases of all when it came to difficult-to-recruit/fill positions. Meanwhile, US organizations saw these skills move from #8 to #4 in this category, while Canadian organizations saw them rise from #7 to #4 in difficulty.
- Throughout all of North America, organizations saw Cloud Computing skills move up slightly from #5 in 2017 to #4 in 2018 in regard to recruiting difficulty. In the US, these skills moved up from #5 to #3, whereas in Canada, they remained stationary at #5.
- As for Internet of Things (IoT) skills, US organizations saw the most pronounced movement in recruiting difficulty, with an increase from #12 to #8 most-difficult-to-recruit skill, year over year. In Canada, these skills rank #8 in recruiting difficulty.
Offering Extra Compensation for Hot Skills
Within the competitive IT labor market, data shows that organizations are offering a little bit extra, beyond the base salary, to initially attract in-demand talent with certain high-value skills.
Pay Incentives and Skills Premiums
To overcome recruitment and retention hurdles, many organizations are offering various pay incentives to keep talent interested. Companies may choose to include a premium into their base salaries by targeting a higher market percentile. Others may choose to design and deliver skill premiums through a bonus program.
In terms of which strategy is most popular, the latest Mercer/Gartner IT survey data indicated that the latter is the preferred approach for the majority of companies. That’s likely because the delivery of skill premiums through a bonus program avoids locking in premium pay as fixed costs, which are often hard to remove. As a result, it also reduces the entitlement mentality amongst program participants, while also allowing for easier changes to individual eligibility and the criteria for payout. As you can imagine, this enhanced flexibility comes in quite handy as the criticality of different skills and competitive conditions evolves over time.
Which Jobs Are Receiving Extra Compensation?
As it turns out, there has been an increase in the percentage of organizations offering extra compensation for hot tech and IT skills. To gain a better understanding of what these hot skills and jobs are (as well as which compensation practices are being used as rewards), all North American survey participants were asked to identify the skills and jobs they offered extra compensation for over the past 12 months, whether in the form of skill premiums or retention bonuses.
Industry survey data showed that professionals with skills falling in several areas are most likely to receive extra compensation for their work:
- Business Intelligence/Information Analytics (e.g., Predictive Analytics)
- Information Security (e.g., Cyber Security, Forensics)
- Architecture (e.g., Application Data, Infrastructure, Security)
- Artificial Intelligence and Advanced Machine Learning (e.g., Deep Learning, Neural Networks, Natural Language Processing (NLP))
- Hadoop (e.g., HBase, HDFS, MapReduce)
- Cloud Computing (e.g., IaaS, PaaS, SaaS)
- JAVA (e.g., JAVA EE, JAVA ME)
Overall, the premium compensation amounts paid in North America had a wide range across different skill sets. The lowest was at 5%, while the highest was at 30% of annual base salaries. However, the median was typically around 10%.
Things to Consider Before Offering Extra Compensation
Of course, the goal of offering extra compensation is to make it harder for other organizations to compete with your hiring offer or to attract your employees with promises of higher pay. However, this type of practice can be costly to maintain and even costlier to discontinue once it’s in place (it could even result in high rates of turnover among disgruntled or disappointed employees). As such, your decision to implement an IT skill premium should always be supported by your company’s overall compensation strategy, while also being directly aligned with the goals of your digital business initiatives.
With these things in mind, remember these best practices and considerations when designing your premium pay programs:
- Skills qualified as hot for premium pay purposes should be not only highly sought after in the market, but also critical to your organization.
- Monitor market trend closely to validate your hot skills list against your competitors and proactively identify changes. This will help ensure your premium pay programs remain competitive and responsive to changing business needs.
- The eligibility for skill premiums should be for individuals who not only possess a hot skill but also use that skill at least 50% of the time when performing their jobs.
- Individuals must continue to deliver satisfactory performance to maintain their eligibility for premium pay.
Ready to Prepare Your Workforce for the Future?
As you can see, more and more organizations are entering into the competition for top IT talent. As a result, the stakes for finding skilled employees are higher than ever. So, if you want to be well-positioned and market-competitive while building your IT workforce of the future, you must make the recruitment and retention of top IT skills a strategic priority.
Regardless of what industry you’re in, the 2018 North America Mercer/Gartner IT Jobs and Skills Survey is an ideal resource for learning about the hottest and most in-demand jobs and skills. Featuring insights from over 725 companies throughout the US and Canada, this all-in-one report touches on matters such as industry turnover rates, training budgets, workforce compensation trends, diversity and inclusion initiatives, and everything else you need to build a future-ready workforce.
In addition, the 2018 US MBD Mercer Benchmark Database Survey contains even more insights surrounding hot IT jobs. The latest edition of this general industry database covers 2,600,000+ incumbents across 6,600+ positions and again finds Mercer working with Gartner to offer a myriad of IT-focused data points. Whether used on its own or in combination with the 2018 North America Mercer/Gartner IT Jobs and Skills Survey, the 2018 US MBD Mercer Benchmark Database Survey is yet another powerful resource for building the most effective and competitive compensation strategies possible.