Finding new tech talent is always a challenge, but there are specific challenges (and benefits) to doing so during economic uncertainty.
As if the last few years haven't been challenging enough, many of the world's largest economies are now facing unprecedented inflationary pressure . This is compounded by record employment in the United States, creating a strange combination that has never been seen on a sustained basis.
For technology leaders, this adds even more uncertainty to an already challenging hiring and talent retention environment. As big tech companies grew and remote work spread, companies of all sizes competed for talent, with big tech companies willing to offer candidates lucrative stock options and benefits.
More recently, however, these same companies have been reducing hiring plans and, in some cases, reducing staff . Concerns about economic conditions and a declining technology stock market have slowed the technology hiring frenzy. Although demand remains high, it appears to be rationalizing. For technology leaders navigating these changes, several strategies can attract previously unattainable talent to their organization.
Stability vs. Stock
One could be forgiven for believing in the “stocks only go up” mantra. That appears to have been true until this year, especially for technology stocks. However, the technology-heavy NASDAQ suffered a decline of more than 20% in 2022, which, combined with annual inflation approaching 10%, undermined equity-rich compensation plans.
All uncertainty presents an opportunity for some organizations, and current technology market conditions are no exception. If your company struggled to acquire talent 6 months ago and abandoned the effort, it might be a good time to reopen your search.
While several months ago job candidates might have scoffed at their company's lack of stock options or turned their noses up at a “boring” cash-based compensation plan, stability has suddenly become attractive again.
Pay stability can become even more attractive when combined with more stable working conditions. Many large technology organizations continue to oscillate between remote work and in-office work. A predictable work-from-home policy or even a network of regional offices that allow employees to work outside of urban technology centers can be used as a key selling point that others cannot match .
You'll also be able to offer potential employees more interesting challenges than big tech companies. Helping solve a complex global supply chain problem may be more compelling than building another streaming service or marketing-oriented social app.
Consider “unconventional” staffing
If financial uncertainty has impacted your business and restricted hiring, consider alternatives outside of standard hiring to address any gaps. An obvious approach to external staffing is to hire a staffing agency to provide technical expertise on a time and materials basis.
This agreement allows you to acquire technical expertise without making a long-term commitment . There are also contract-to-hire agreements through which you can quickly integrate an experienced individual into your team. Instead of extensive job interviews or recruitment, this allows you to “try before you buy” and test the individual's technical competence and fit with your organizational culture.
The key to a time and materials style relationship is to ensure you have an end goal in mind. Hiring a significant number of people within time and materials can be expensive, especially if the skills they were hired for lose relevance or if a project is completed.
For example, if you need to create a one-off mobile app, you can hire half a dozen skill sets needed to create an app and try to redeploy them once the work is done. Or you can hire individuals and pay them based on time and materials, taking on management oversight and integration between resources. Both scenarios require a fair amount of complexity and leadership.
Compare this to “renting” a capacity. You can hire a company to provide app development services and pay a recurring fee. The provider can scale up or down various features as needed, for example, using multiple front-end designers early in the application development process and transitioning to more developers as the lifecycle progresses. This should largely be seamless for the company contracting the services and, depending on the contract, have little or no impact on the overall service costs.
A partner's involvement in this capacity should also include management and tools. Again using our mobile app development example, the provider must have its own development methodology, repositories and documentation standards. Just as corporate IT departments typically receive requests from other business units and then manage execution, reporting, and delivery with minimal oversight, a capability-based vendor should act as an extension of your organization without having to manage the details of the day to day.
Providers of these services are probably equally concerned about macroeconomic trends, which can be a negotiating lever for long-term relationships. Identifying and engaging with capacity-based suppliers in advance allows you to establish a relationship and define any pricing or legal requirements so you can quickly increase or decrease capacity as needed, without the challenges associated with traditional hiring or temporary staffing.
Keep an eye out for discounts
Whether it's sportswear that's now overstocked or tech talent with skill sets in decreasing demand, it's worth watching the talent market for trends and opportunities. Check in periodically to ensure your HR colleagues understand which skill sets to monitor, and evaluate your partner portfolio for potential gaps that can be addressed.
Uncertainty can create opportunities amid difficulties, and savvy technology leaders can get a “deal” on high-quality talent, whether added to the payroll or engaged through a capabilities-based relationship.
