As we reported in our Q3 instalment of The Lookout, tech is seeing a slow shift back to an employer-driven market. Permanent placements are continuing to fall, temp billings are stagnating, and as uncertainty rises; businesses are scaling back recruitment.
Has the technology bubble finally burst?
Some believe so. Multi-national giants like Twitter, Meta, and Alphabet are all orchestrating mass redundancies; a warning sign that even the most successful are feeling the squeeze.
Yet the demand for UK tech talent remains high. It feels like a sector-wide balancing act - how can we prepare for a recession, continue to innovate, and retain valuable talent?
In a sea of red flags, wave the green flag of stability. Success in 2023 boils down to your organisational stability; both commercially and in terms of your ability to retain existing staff.
Why is hiring so difficult right now?
Compared to pre-pandemic numbers, there's been a surge in economic inactivity. This refers to the proportion of people not in work and not looking for work. Suggested reasons for this include Long Covid, financial pressure and resultant stress, and long waiting lists meaning health deteriorates to the extent someone cannot work.
However, the ONS found that two thirds of those "becoming long-term sick in 2021 and 2022 were already economically inactive for another reason in the three months before interview."
So where are all the active candidates?
Probably toughing it out in a job they hate, or struggling with job hunting. In a Harris Poll survey conducted by Bloomberg, 63% of jobseekers say they’ve been searching for more than six months, and 72% report companies aren’t responsive—"ignoring applications or failing to follow through on interviewing."
Does this mean there a potential wealth of untapped talent being missed? Is it solely due to poor recruitment practices and ineffective communication? Possibly. One thing that's certain is that it's much harder to convince candidates to move jobs now unless they're offered all the bells and whistles.
Bare minimum doesn't cut it anymore
The pandemic laid bare a culture of corporate tokenism, in the form of useless 'pizza party perks', below market rate salaries, and lacking performance-based reward policies. Now, more than ever, people are honest about wanting to 'work to live', not live to work. Phenomena like 'quiet quitting' - where employees do no more than their contracted work - have gained traction because of this shift.
Now the market is tightening, it's vital to assess your stability in the context of retaining staff and attracting new people.
What do we mean by stability?
In an organisational context, stability can mean a rigid and inflexible structure, with a direct vision. In 2022, organisational stability looks like maintaining staff numbers and finding the right people for new roles.
Job seekers are exposed to daily headlines of mass redundancies and restructures hitting the tech sector. Even when a job offer meets all their requirements, will they accept? Many are concerned about the uncertainty of taking a new job, particularly where lack of employee protection is concerned.
"Last in, first out" is ringing in the ears of UK job seekers. Nobody wants to go through the upheaval of leaving their current employer for a shinier option, only to be ousted a few months down the line.
How can we communicate stability to candidates?
Looking inward is key. You need to create an employer brand, hone your EVP, and make a good impression on candidates right from the start of the hiring process; or even before.
"For business leaders, 2023 presents an opportunity - perhaps not for growth but for reflection. Now's the time to take stock and improve working conditions, ready for recovery when employees and candidates once again create open, flexible, and healthy workplaces where they can thrive," says David Morel in his '2023 outlook' piece for Forbes.
Stability can be evidenced by modest growth plans, but also through investment in your current workforce. You can't expect to attract new talent to a culture that leaves the back door open.
What are candidates looking for in 2023?
Job seekers are looking for longevity in new roles - the opportunity to train and develop their skills, and a clear progression pathway.
Accommodating diversity and difference of thought is also key to attracting top talent... Plus, it’s becoming clearer that cultivating a diverse workforce is a commercially intelligent choice. For example, 20% of the UK population is neurodivergent, with that figure rising to over 25% in technology work cohorts.
"When deciding where to work, applicants will no longer only resort to statistics of how the company is performing and what the employees find on their annual pay slip. Questions about environment, social and governance (ESG) issues are at or near the list of people’s priorities when choosing a workplace," says Manfred Schmid, Global Head of Employment & Reward at Pinsent Masons.
In terms of retention, aim to remove ageist bias from your agenda. Retaining the skills of the over 55s is vital to ensuring your workforce remains stable. As this cohort features one of the highest economic inactivity rates in the UK, providing a supportive environment and training for older workers is a great way to benefit from their knowledge, networks, experience and diversity of thought.
What if my company isn't doing all this?
The time it takes to fill a job increased by 50 days since last year, to an average of 68 days. That's a time to hire statistic you don't want to still be battling with in 2023. Improve your employer brand as a starting point - audit your company, define key points, hone, test, and start shouting about it.
Not sure where to start? Follow our guide to improving your EVP and hiring the competition in 2023.
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In January's issue, we will break down the state of the market; covering supply, demand, salaries and opportunities to approach the market more intelligently.
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