Unless you’ve been living in a cave for the past couple of years, you’re probably pretty tired about hearing how hard it is to hire top tech talent. Yeah, I’m tired of hearing about it by now, too.
As you’re well aware, the market for skilled programmers, developers, engineers and designers, has always been fiercely competitive; the supply of qualified candidates in tech has always been unable to keep up with market demand; this, like most things in recruiting, is not actually news.
What is news, however, is that somehow, the supply of available programming talent has actually shrunk over the past two years (despite the myriad boot camps, coding academies and STEM education initiatives which have largely failed to keep pace with the market).
In the US, this situation has been exacerbated by new restrictions on foreign work visas and the VC enabled proliferation of new technology companies, compounded with the need of more established Silicon Valley players to continue to grow at scale.
Why Tech Recruiting Is Getting Harder
Globally, the rise of completely new categories, particularly the increased market focus on data science, machine learning and the so-called Internet of Things have only exacerbated the surfeit of qualified talent.
Similarly, every traditional business, from big box retailers (WalMart, Whole Foods, etc.) to commercial real estate brokers (WeWork, ImpactHub) or even otherwise fairly traditional staffing agencies (TopTal, Hired, etc.) are now positioned as “tech companies,” which, of course, only increases competition for the same finite pool of talent. This is probably a smart play for financial markets, but an increasingly perilous strategy for labor markets.
In every market, churn in tech is at an all time high, a sign that tech talent not only knows what they’re worth, but are also leveraging market conditions to take similar roles with higher salaries, better benefits and more flexibility.
Conversely, this has made retention in tech an almost Quixotical effort. Companies have invested so heavily in workplace perks (free lunches, onsite day care & dry cleaning, private commuter buses, etc.), and put such an emphasis on culture branding (or cultish brainwashing, depending on your perspective) for the very reason that in a world where cash is king, internal equity and compression have made keeping up with the open market nearly impossible.
This is particularly for public companies who can’t augment their comp with pre-IPO equity (stock options at this point take longer to vest than the average employee tenure for skilled tech positions).
It’s easy to admonish technology companies for their lack of diversity and inclusion, and similarly easy for those companies to counter with transparent annual reports, outreach efforts and D&I programs which go far beyond the definition of “good faith” efforts and similar PR efforts disguised as HR initiatives.
But at the end of the day, diversity and inclusion are irrelevant when the shortage of talent is so acute and the skills gap so large that there aren’t enough candidates, period, regardless of which protected class they happen to belong to.
Brogrammers are the worst, but there aren’t even enough of them out there to make a dent in what, for private industry, is a crisis approaching endemic proportions.
We have been talking about the shortage of tech talent for long enough to have developed a viable solution, whether driven by private technology, public policy or simply, collective economic necessity.
For all the press and focus this growing issue has received, however, the public response has been less than pragmatic; the relative number of CS and STEM graduates has remained essentially flat (with the exception of interactive media); the extremely high barriers to entry remain largely entrenched, and companies are counterintuitively becoming more selective in hiring tech talent.
By adding on things like skills assessments, structured interviews and culture matching technologies, recruitment, in aggregate, has actually extended an already overly complicated hiring process, often at the expense of making actual hires.
Tech Recruiting: 3 Simple Strategies for Hiring Success.
Time to fill has increased in tech, and offer acceptance ratios have gone down, meaning that talent acquisition actually might not be part of the solution to a persistent, pervasive people problem.
We’ve become so obsessed with finding the “right candidate,” we’re struggling to find any candidates at all, a problem that’s sadly secular, not cyclical.
So what are we getting wrong when it comes to recruiting for tech talent? Here are three small changes that would make a big difference.
1. ROWE is Me: Tech Recruiting in A Results Only Work Environment
For as much as we talk about “digital transformation,” technology companies are still as likely as ever to put a premium on the physical workspace, sinking billions of dollars in unnecessary capital expenses in a pyrrhic attempt to differentiate from the competition. Ultimately, even if you have the coolest office with the best onsite perks in the world, most skilled tech workers would really prefer flexibility over forced facetime.
Go to any major city in the world, and there’s a pretty good chance that you’ll see a local version of downtown San Francisco, from the manifold Salesforce towers that have popped up on every skyline to Silicon-Valley style campuses that make the likes of Dublin, Ireland look more like the Bay Area than Dublin, California.
Part of this is to ensure cultural conformity and create a consistent, standard experience (not to mention processes and products) for their global workforce. Part of this is because, simply, even the most cutting-edge tech companies still haven’t participated in the digital transformation they’re purportedly creating.
If you’re selling “the cloud,” or desktop virtualization, or really, any of the core concepts around interconnectivity, agility and scalability that are at the heart of tech’s core value prop, then you’re essentially selling against your employer brand, which predominantly positions works as a place you go, rather than a thing you do.
Moving to a results oriented working environment should be a no brainer for tech functions in general, and at technology companies in particular. First off, productivity isn’t ambiguous, as in many functions; you’re either programming, testing or updating code, or you’re not.
The quality of programming is location agnostic; no one (save a few national security apparatuses) can really differentiate between code written in, say, Prague, with code written in Palo Alto.
The major difference is the former is a whole lot pricier than the latter. Paying a premium for a product that’s indistinguishable from a lower cost alternative is just bad business (this is why we have expense policies and procurement). And yet, in TA, it’s business as usual.
I always hear some variation of “how do you compete with Google, Apple or Amazon when you’re recruiting for tech?” when I talk to tech recruiters from companies who aren’t necessarily big brands or hot VC plays, and the answer is simple: you don’t.
You differentiate through flexibility and work-life balance, both of which are far more salient selling points than, say, slides in cafeterias.
2. Tech Recruiting: Taking A More Inclusive Approach to Diversity
A completely decentralized workforce not only has the advantage of being much lower cost, but it also exponentially expands the available pool of talent to any given employer. It’s hella hard hiring programmers in SF, which has among the worst commute times and diverse population percentage of any major US metropolitan area.
So, yeah, it’s hard to tackle the D&I issue when you require your workers to be physically located in a place that’s predominantly white, prohibitively expensive and has little to no economic mobility (key to solving some of the core issues pertaining to access and availability of diverse talent). Compare that to Atlanta, which has more tech jobs per capita than San Jose, and has a significantly more diverse population in terms of visible minorities, veterans and working women per capita.
Put simply, if you want to hire an African American programmer, your shot of finding one in the Atlanta metro (or DC, or Charlotte) is about five times greater than finding that same profile in the Bay Area. That’s not big data, that’s simple math; there’s a severe misalignment between where tech jobs are, and where that talent actually lives.
Correcting this imbalance means increasing flexibility and democratizing access for talent outside of the traditional tech markets. Similarly, allowing women to work from home is, obviously, a pretty straightforward solution to the continuing child-career conundrum.
Further, it would minimize workplace harassment, create a culture of meritocracy (there’s minimal office politics when you don’t have an office), and if results are the only thing that matter, then unconscious bias or adverse impact on protected classes is obviously minimized).
A greater pool of potential candidates, increased access to underrepresented populations and decentralized power structures, coupled with less market competition and the savings on capital expenses that would be realized from just implementing ROWE.
You don’t need AI to tell you this would be a no brainer.
3. Build, Don’t Buy: Tech Recruiting and Talent Mobility
This is one of the biggest questions every high growth tech company considers when looking at their own product roadmap or corporate development strategy; do we use our in house engineering and development capacity to create a proprietary feature or function, or do we partner with, acquire or white label an existing solution?
You hear this in HR Technology all the time; the SAPs, Oracles and Workdays of the world all tout the value of a single instance, multi-tenant solution that’s all delivered seamlessly in a single interface via a single vendor. This is a primary selling point for buying a tier one ERP, after all; consolidation, not configuration, of disparate systems into a unified solution is a major initiative in talent today.
With the average F500 company using 18 different point solutions, SaaS applications and systems in TA alone, moving from a “Frankensuite” to a streamlined stack has obvious advantages, which is why if you’re not building in TA Tech, you’re probably having a hard time reaching buyers.
And as far as those buyers go, well, few if any have a proprietary or homegrown HRIS solution, and those that do are considered market laggards – it’s obviously cheaper to buy existing software than build your own, even if it means sacrificing some of the utility or applicability homegrown systems can provide by being built to order for an individual company’s processes, policies or procedures.
Build versus buy may remain a critical consideration in tech, but in tech recruiting, it’s really a no brainer. Buying isn’t only inefficient in terms of both time and money, it’s also not a long term fix to any systemic skills shortage.
You can hire the best talent on the market, but you can’t keep the market from hiring your best talent.
It’s kind of an inevitability. If you’re reliant on people with computer science or engineering degrees with previous experience in some highly niched tech category, as most tech job descriptions require, you’re looking at a finite and fixed pool of very expensive, very elusive candidates. It’s a strategy that cannot succeed at scale.
That said, there’s a reason major staffing firms are quietly acquiring coding academies and boot camps; it’s because in almost every case, building talent rather than buying yields better business results, and far higher ROI in terms of human capital investment.
There are, by some estimates, over 100 coding bootcamps on the market, which is a lot since the first started only 7 years ago – in fact, it’s projected to have grown into a $300 million industry annually, according to Course Report.
That $300 million, which is almost exclusively financed from tuition and student fees, has resulted in an estimated 25,000 annual coding bootcamp graduates this year; of these, 23,000 new developers will be hired by companies, all with recent, relevant expertise and experience in the languages and technical skillsets that are the most in demand by employers.
The average program takes 15 weeks to complete, and little to no technical expertise is required for students to enroll. As these programs face increased competition from the 50 or so competitors estimated to enter the space by YE 2020, their success or failure rests almost entirely on their efficacy at job placement, meaning that most have a curriculum that is entirely applied, dispensing with theory for efficiency and efficacy to create the most marketable programmers possible in as little time as possible.
At this, they’ve been hugely successful (with a median placement rate of 93% within 6 months of graduation, although there are no reporting standards in place to check this against). In other words, in less than two quarters, and for an average cost of $13,584 a student, these bootcamps can effectively manufacture the tech talent that companies are spending so much money in order to source and attract.
Compare this to a 68 day average time to fill for technical roles across industries we’re seeing in the private sector, with an average cost per hire for experienced coders and programmers running around $8600 in the US.
We’re buying, and the skills gap keeps growing; the numbers suggest that there’s not a huge advantage in searching the market for experienced tech talent when there’s a ton of evidence that building is actually a much better option for sustainable workforce development and planning.
For as much as we’re spending on L&D, it’s a wonder that more companies aren’t developing their own bootcamps explicitly to train workers on the actual languages, programs and use cases specific to an employer, which would maximize time to productivity even for a programmer with no coding experience, versus someone who has to apply past experiences to the completely new challenges that come with changing companies (which, as we all know, takes some time).
It would standardize the way companies train tech talent, help actually move the D&I needle by taking underserved or underrepresented workers and subsidizing training and skills development that are so often so out of reach for so many, and allows companies to stanch tech turnover by requiring successful graduates of these training programs to remain with the company for a fixed period of time in exchange for this training (think: ROTC for geeks).
Not that it would matter; the loyalty these employees would feel for any employer willing to help improve their quality of life, personally and professionally, by reskilling them and providing a livable wage are far less likely to jump ship to a competitor.
With the average tenure for programmers sitting at just over 2 years across the tech sector, the reduced turnover alone would make developing these programs in-house have a significant impact on business operations, continuity and bottom line results.
But perhaps the biggest business case is foundational economics: market prices don’t matter when you have enough supply to satisfy demand. The same goes for recruiting tech talent, too.
