Tuesday, July 25 2017
By Chris Engle, Vice President, Avalanche Consulting
After nine years of economic expansion this summer, the U.S. unemployment rate has fallen to 4.3 percent, a 16-year low. Labor shortages throughout many parts of the U.S. are significant and affecting all sectors of the economy. Few industries, however, are more adversely impacted by the tight labor market than the IT sector. Technology workers are among the most difficult-to-find, and IT wage levels among the fastest growing. With digital technologies filtering throughout all aspects of life and business, the lack of available IT workers will ultimately impact a host of other industries.
Concern over availability of tech workers has spread throughout the U.S., from major markets to small midwestern regions. In a recent survey by Avalanche Consulting, 90 percent of local economic development leaders across the U.S. reported that finding a skilled workforce is the top growing concern for companies. The availability of a talented labor force has become more important than more traditional site selection criteria such as business climate and infrastructure. In fact, we believe that the changing nature of the workforce will be the defining theme of the U.S. economy over the next decade.
In this article, we will explore 1) drivers affecting today’s technology workforce demand, 2) where to find technology workers, and 3) how to grow and retain your technology workforce. While all STEM (science, technology, engineering, and math) workers are in high demand from healthcare to industrial manufacturing, we focus this article on a definition of “technology worker” that is information technology-centric, including software fields as well as hardware engineering and mathematics.
What are the Key Drivers of Technology Workforce Demand?
Where Can You Find Your Future Technology Workforce?
tartup, odds are that you look to your tech workforce to be your top competitive force for the near- and long-term future. How can you find the new workforce you’ll need for years to come?
1) Formalize and optimize your college graduate recruitment strategy. Commit to participate in recruiting activities at a core set of colleges each year. Get to know the department heads that you recruit from. Participate in internship programs each summer. Activate the alumni networks within your current workforce. Identify the colleges to recruit from that are right for you. If you
are a large or VC-backed company and can recruit the best of the best, focus on the major markets for tech grads.
If you want to stand out from other firms or want to improve your offer-to-hire conversion rate, look toward regions that are heavy producers of college grads but don’t have a lot of IT jobs.
2) Open an office in a region that already attracts a technology workforce and offers competitive salaries. Over the last decade, companies have flocked to second-tier tech markets like Austin, Portland, or Madison. But, as wages and cost of living escalate in these high-growth areas companies now have the opportunities to look for a deep tech workforce in other emerging tech hubs both large and small. Below is a list of mid and large metros with the fastest-growing IT workforce that still offers competitive IT wages.
Growing and Retaining Talent Where You are Now
Many local chambers of commerce now have workforce planning efforts and lead talent development programs. This is relatively new – and overdue - but will become the gold standard of success for a local economic development program. Local chambers and economic development organizations are also starting to manage campaigns to recruit and retain talent, which can help companies boost excitement around the region’s quality of life assets and draw in new workers. Some chambers even take companies to other markets to run job fairs.
With the economy changing and workforce skills continuously needing upgrades, chambers look to their business community for guidance on priorities. What positions are hardest to fill? What skills are lacking from local college graduates? In which programs do we need to boost local graduate production? How can lifestyle assets be improved to make attracting a workforce easier? Chamber seek to match local college programs with demand for local employers by developing a Talent Alignment Strategy. Find these and get involved. These programs serve the needs of the company, help a local college grad find a job, and retains more grads in the economy – a win-win for all involved. Companies with large or unique labor needs should work with chambers to provide annual input to post-secondary institutions on their needs.
Also, get involved in K-12 education. The more kids can learn about technology at an early age, the more likely they will turn into your IT workforce.
In summary, today’s tight labor market requires new and creative approaches to finding and developing your future technology workforce. Spread your recruitment efforts and expansion plans to new institutions and new regional markets. Get involved in local planning and branding efforts to grow the size of the tech workforce. Help educators understand how their curriculum should adapt to a changing technology landscape.
Solving today’s workforce shortages in technology will require a collective, collaborative approach between the private sector, government, education institutions, and students. Fortunately, we now have the communications technologies to make these connections happen more regularly and efficient. Now, do we have the will and the persistence?
Bio: Chris Engle, Avalanche’s Vice President, is a national thought leader on economic development strategy, workforce planning, and industry trends. He has over 20 years of experience as a researcher and strategist. His expertise includes economic analysis, benchmarking, workforce supply-demand gap analysis, labor market studies, and site selection. Chris has contributed to dozens of economic and workforce development plans for communities across the U.S. and abroad, including Greater Charlotte, Miami-Dade County, Providence (RI), Gainesville (FL), Hampton Roads (VA), Charleston (SC), Jefferson Parish (LA), Northern Kentucky, Quad Cities (IL), San Joaquin County (CA), Santa Fe (NM), Winston-Salem (NC), the Czech Republic, and Portugal, to name a few. His corporate clients have included Applied Materials, Dell Computer, Gables Residential, Opus Development, and Stratus Properties.