Tech Talent Shortages: How HR Software Can Aid Hiring

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The UK tech industry appears to be booming, with the number of tech job opportunities reaching record highs and the demand for tech skills growing continuously.

According to a 2022 report by Tech Nation, data from job search engine Adzuna found that tech roles comprised 14% of all job opportunities in the UK last year, up from 11% in 2019. The data also revealed there were about 870,000 tech and digital job vacancies in the first few months of 2022, which is the highest number since 2012.

However, supply isn’t quite keeping up with that fierce demand. The tech industry is facing a huge talent shortage which is jeopardising growth in the sector and holding many businesses back. Recent research by Nash Squared found that 70% of the digital leaders surveyed are suffering from a major skills shortage that is preventing them from keeping up with changes in the tech sector; while 62% believe they will never have enough tech staff.

What’s driving the talent shortage in the tech sector?

There are several reasons, comments Devin Blewitt, commercial director at training provider ITonlinelearning. “Firstly, the industry is constantly evolving as innovation is continuous, creating a high demand for skilled workers and a demand for skills which aren’t all that commonplace. As a result, companies are finding it challenging to fill positions in areas such as software development, artificial intelligence, and cybersecurity.

“Secondly, there is intense competition for talent within the tech industry itself. Technology companies are not only competing with one another, but also with other industries such as finance and healthcare, who are also seeking workers with similar skillsets. This has led to companies offering attractive compensation packages, perks, and benefits to attract and retain talent, creating a challenging environment for smaller or newer companies with more limited resources.”

Rupert Deering, co-founder of recruitment business Timberseed, agrees that the war for talent is one of the key reasons why the sector is facing shortages. “Right now, it’s a candidate-driven market, and the shortage of tech talent for companies is largely down to demand outstripping supply. Nearly 30% of high-growth companies in the UK are hiring, equating to nearly 15,000 companies. Competition for top talent is fierce.”

Talent shortages in the tech sector impact the industry in several ways. For instance, it can hinder digital transformation, meaning that businesses are slow to adopt technologies such as IT automation, digital workplaces, and security.

The skills shortage can also slow down the pace of innovation and development, says Devin Blewitt. “With a shortage of skilled workers, companies may struggle to meet project deadlines and may not be able to work on as many future projects as they would like. This can lead to a backlog of work, missed opportunities, and a reduction in competitiveness.”

However, there is one potential beneficial impact of the talent shortage, he adds. “Employees may look to expand their skillsets if they are needed to fill holes within their organisation. Whilst this can be time-consuming, by developing their skills, it enables them to be more productive and increases their value to their employers.”

What tech skills are most in demand?

As technology is constantly evolving, so too are the most sought-after tech skills. “SaaS companies received £25bn investment in 2022, so cloud-based technologies are still very much in demand,” comments Rupert Deering, who adds that AI and machine learning are also hot topics right now.

“One of the most in-demand skills at the moment is software development,” adds Devin Blewitt. “Companies of all sizes and industries require skilled software developers to design, develop, and maintain applications that power their businesses. This includes skills in languages such as Python, JavaScript, and Java, as well as experience with software development methodologies such as agile and DevOps.”

Another top skill is data science, says Gabriel Pizzolante, UK growth marketer at Ironhack tech school, adding that organisations will need to focus on upskilling and cross-skilling people if they wish to fill data analytics vacancies in the workforce.

“The UK is making an evident push to fill the skills gap and will be giving funding to programs aimed at upskilling employees in data processing, gathering and analysis. The focus will be on up-to-date and real-time data, which companies are increasingly leveraging to grow and make sales. Managing and extracting data on the backend is great, but businesses need people who can analyse, organise, and understand the implications of the data.”

What more needs to be done to close the skills gap?

Reskilling and upskilling are key here. It’s essential that employers invest in learning and development to help tackle the talent shortage. This includes, for instance, creating a culture of continuous learning within the business, developing mentorship programmes, and defining clear learning pathways to enable workers to gain key tech skills.

“Investing in education and training programs is a must to develop the next generation of skilled workers,” remarks Devin Blewitt. “Companies can also partner with training providers, universities, and vocational schools to create industry-specific training programs that teach the skills needed for specific roles.

“Secondly, companies can work on fostering diversity and inclusion to attract a wider range of qualified candidates. This includes initiatives such as unconscious bias training, implementing equitable hiring practices, and providing mentorship and networking opportunities for underrepresented groups. By creating a more diverse and inclusive workplace, companies can attract a wider pool of talent and benefit from the diverse perspectives and experiences that this brings.”

How can HR software help the tech talent shortage?

Many human resources departments rely on HR software to support recruitment, boost retention, and develop talent within the business. Helen Armstrong, CEO and founder of Silver Cloud HR says that HR software is pivotal in streamlining HR processes to hire the right people in the fastest time.

“Recruitment software acts as an internal CRM, which creates talent pool data for current and future roles,” she remarks. “But beyond the new hire process, your HR system can support all your talent development initiatives. It will give HR the data it needs to identify development needs and succession plans. It can help manage performance and identify potential concerns before they come an issue. The right HR tech can be the tool HR needs to manage every aspect of an employee lifecycle and when an employee feels valued and invested in, they will stay.”

HR software makes it easier and faster to identify, attract, and hire qualified candidates, adds Devin Blewitt. “This includes using AI-powered recruiting tools that can analyse job descriptions, resumes, and social media profiles to identify the most qualified candidates for each role. HR software can also automate time-consuming tasks such as resume screening and scheduling interviews, freeing up recruiters to focus on more strategic activities.

“Secondly, HR software can help businesses to develop and retain their existing talent by providing tools for performance management, training, and career development. This includes features such as goal setting, performance tracking, and training management, which can help employees to develop their skills and progress within the company. HR software can also provide insights into employee engagement, satisfaction, and retention, allowing businesses to identify potential issues and take action to address them before they lead to turnover.”

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