So you’re having trouble filling job vacancies at your company. Have you increased salaries but still can’t find the qualified candidates you need? Are you running out of places to look for the right employee? You’re not the only one, the Education and Workforce Center at Georgetown University reported that the technology industry is one of the two major careers with the lowest unemployment rates for recent graduates, the second being the healthcare industry. That means there are fewer applicants for job offers, this is what we know as a labor shortage.
In fact, the US Bureau of Labor Statistics predicts that by 2020 there will be 1.4 million more software development jobs and only 400,000 candidates who can fill them.
Schools and other technology education programs do not seem to produce candidates fast enough since only 100,000 engineers graduate every year.
In addition, CareerCast, who evaluates data from the Bureau of Labor Statistics (BLS), found the current 4 most difficult positions to cover in the technology industry are:
- Data Scientist – with an increase in annual demand of 15.7%.
- Software Engineer – with an increase in annual demand of 17%.
- Application software developer -with an increase in annual demand of 31%.
- Information security analyst – with an increase in annual demand of 18%.
What drives the demand for these positions?
The factors that drive demand vary. Some of the current common factors include: labor shortage of qualified candidates with specialized skills, the lack of new graduates in some professions, the rapid advances in information technologies, and the speed with which these technologies spread throughout different industries.
Indeed highlights that seven of the 10 jobs with the highest demand in 2019 are related to engineering and software development; these results are based on the proliferation of ads for jobs related to the sector and salary increases to more than $100,000 average per year!
These exorbitant increases in wages are not a surprise in a market where employers are working magic to attract new candidates.
Gad Levanon, the chief economist for North America of The Conference Board, a global economic research organization that has studied the recent shortage of American labor, wrote:
“Companies seeking to attract new workers will have to continue to raise wages, and, as a result, may experience reduced profits. “
Increasing wages will not only hurt the company’s financial standing, it will also do very little to alleviate the labor shortage.
The solution?
Companies need to hire more foreign workers.
Because software can be built from anywhere in the world, some developer jobs can be moved to countries with more affordable salaries. It’s not because the jobs are ‘cheap,’ rather, it is because the number of job offers in the United States has been greater than the number of applicants for eleven consecutive months. And as time passes, that gap increases.
Look at the table below. For two decades, there have been more workers available than jobs available. That changed in 2018.
We talked about hiring more foreign workers to meet the demand.
Candidates available to American companies in the technology industry are increasingly in the global market and especially in countries such as Mexico, Argentina, and Brazil.
That is not to say that local and national workers will not continue to be important. They will always be essential, especially for jobs that must be done in accordance with national culture and customs.
However, companies that do not adjust to these changes in the recruitment market will almost certainly struggle to attract and recruit the talent they need to execute IT projects in the near future.
Finally, taking into account the above, many leading companies such as IBM, HP, Oracle, Amazon and more, are already executing successful strategies in Mexico. This has allowed them to recruit the talent needed to grow without damaging the production chain when they attempt to simply increase wages.
In fact, in our report Tech Salaries in Mexico, we found that the average salary in the technology industry does not exceed $45,600 per year nationwide.
Mexico has a number of elements that make it an excellent country to solve the shortage of talent and we believe that in the technological race and in the highly competitive world, in which we live, to know what options and opportunities you have available as a company to achieve your goals, it’s key.
