Has the Lockdown Tempered the IT Talent Crisis? A Comprehensive Market Update

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“The worst part of a 7-day lockdown is the first 3 months”

With no end to our lockdown in sight, it’s unsurprising we’re starting to see a little gallows humour. Many of us are trying to look for a silver lining. And some are hoping the lockdown will see a return to a more normal IT jobs market.

The TLDR answer is: No. 100% No. The talent shortage has not eased.

What we’re seeing at Balance

At Balance, we literally have more work on than at any time in the last 14 years. We have employed a number of new team members to keep up with demand (Big welcome to Chiara, Daniella, and Brendan).

Ad response has continued its downward trend. We saw our median number of applicants per ad drop by almost 30% between Q4 2020 and Q2 2021. The new financial year (which approximates nicely with the start of the NSW lockdown) has seen a further 10% decrease. This does raise the question as to whether this is due to application hesitancy or an imbalance of applicants versus roles.

Our conversations with candidates are very consistent. Most candidates are well educated about the market, they tend to have many suitors, are aware of their worth, and want to take advantage of current market conditions. We are seeing very few individuals who are overly cautious, in fact, most are pretty bullish about their prospects. They know they are in the driver’s seat and can pick and choose roles. There is no application hesitancy.

Media Commentary

An AFR article recently detailed 3 Melbourne/Brisbane-based technology business owners who claimed they had seen an increase in tech salaries in the last year of 28%, 27%, & 30%. Whilst we are not seeing salaries increase to such an extent across the board, certainly candidate demands in the development space seem to have increased by almost this margin.

EY released a statement saying they are experiencing the toughest recruitment market in 25 years. According to the AFR, at the start of last month the five major consulting firms – Accenture, Deloitte, EY, KPMG, and PwC – had more than 500 open job ads on LinkedIn.

And media reports suggest the situation is just as bad in United KingdomNew ZealandUnited StatesCanada, and India. This is a global crisis.

Seek Ad numbers

IT Job ad numbers see a continuation of an upward trend. Total Seek job ad numbers peaked in May at around 200,000 and have since dropped back to 184,000 but have remained steady over recent weeks. In contrast, IT job ads have moved the other way increasing from 16000 to 17000 over the same period, apparently unaffected by the lockdown. Ad numbers are still significantly higher than pre-pandemic levels, despite Seek more than doubling their prices for many customers, including Balance.

Like the property market, could it keep going?

The lockdown has some way to run, but the factors driving the IT jobs boom remain and are likely magnified by the lockdown. People are working, playing, and learning from home. Every business needs to reach their remote customers more effectively – digitisation remains most businesses pressing priority today and looks like remaining so for the foreseeable future. With the borders shut, preventing any meaningful arrival of skilled immigrants and IT students, I see this situation remaining unchanged.
Worse still, the border closures have a 2-way effect. I normally tend to talk about the closures as a barrier to new arrivals. However, many of our best and brightest have been champing at the bit to head offshore to make their mark and will do so en masse once the borders open.

Any solutions?

The solution is planes. Lots of them. Arriving in Australia packed with skilled immigrants, expats, and students. However, when the borders do open, the competition will be fierce, not just with holidaymakers and family reunions vying for tickets, but all developed nations will be bidding for the best global talent.

My tips:

  1. Hang on to your current staff. Be honest with yourself. Are you paying market rates to your team? Or would they fare better if they left you?
  2. Pay more for new hires. Just like the property market, the cost of IT staff has increased. It’s time to be realistic.
  3. Hire graduates before they finish their degrees. We’re currently speaking with a number of greenhorns – they’re open to job offers now.
  4. Move non-IT staff from other parts of your business into tech roles and train them.

As always, I would love to hear your views via e-mail.