The IT Talent Shortage Debate

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Talk to employers and job hunters about the state of the IT talent market, and you hear two words repeatedly: speed and pain. IT leaders must staff projects quickly, often requiring specialized skills that most job hunters -- especially generalists or those looking to change tech tracks -- don't have.

As a result, hiring organizations see an IT talent shortage, while job hunters insist that employers are botching the hiring process, screening out too many good candidates. Both sides agree on one thing: They're frustrated.

Third-party recruiters say that while IT leaders cry shortage and job hunters cry foul, the job slots sit empty for too long, hurting business results and team morale. But they doubt the picture will change unless hiring managers get more creative and realistic, and job hunters come to a fuller understanding of market realities.

Which brings us back to the question: Is there an IT talent crunch? It's a simple question with no simple answer. InformationWeek asked the IT community: Do you see an IT talent shortage today in one or more technology areas important to your business? Yes, said 73% of respondents at companies with fewer than 1,000 employees, and a whopping 88% of respondents at larger companies.

But is a botched hiring process aggravating this talent shortfall? Business technologists are sharply divided: About half of survey respondents at those larger companies see it as broken or too stringent, while 45% of the folks at smaller companies see things that way.

Any discussion of IT hiring must include what companies are willing to pay to fill open positions. Ron Hira, a professor of public policy at Howard University and a longtime critic of the H-1B visa program, recently called the IT talent shortage "imaginary," a front for companies that want to hire relatively inexpensive foreign guest workers. Norman Matloff, a computer science professor at the University of California at Davis who collaborates with Hira, takes the argument a step further: "The biggest single problem, as I've said before, is age discrimination," Matloff says. "The employers typically define job openings to be entry level, automatically rejecting those at the midcareer level."

Another disliked hiring tactic is a "purple squirrel" hunt, whereby companies seek a job candidate whose mix of skills and experience is impossible to find. "The 'purple squirrel' job postings arise in many cases because HR needs a way to thin out the mountains of applicants that they have," Matloff says. "So again, the claimed shortage is actually an embarrassment of riches."

Talk with employers and recruiters and you hear a more nuanced story. It's not just about how many IT job applicants are in the US talent pool, or about salaries, but how the IT hiring process has changed in recent years. Like them or not, would-be applicants need to know the rules of today's employment game.

Need for speed
"This kind of feels like 1999 or 2007," says Matt Rivera, VP of marketing at IT staffing firm Yoh. "… The technologies are moving so fast, it's hard for [employers and job hunters] to keep up. It's hard to engage that talent pool far enough ahead of the need."

IT organizations are under intense pressure to deliver projects faster than before -- and that need for speed necessarily influences IT hiring. The IT generalists, and even some topic generalists, such as infrastructure managers, have found their roles left by the side of the road, as project leaders hire for deep experience in specific niches, such as cloud security, DevOps, and data analysis and architecture.

"There's a lot of desperation on both sides out there," Rivera says. One sign of that desperation: 63% of IT hiring managers reported catching lies on resumés, according to a recent Harris Poll/CareerBuilder survey. IT candidates rank as the third biggest liars; only financial services and hospitality candidates fib more, according to the survey.

"The trend has gone into more specialized skill sets," says Asal Naraghi, director of talent acquisition for healthcare services company Best Doctors. As an HR pro, she "absolutely" sees an IT talent shortage. "In terms of being able to innovate, the tools that are out there are more complex," she says. "What are your competitors doing? You have to keep up with that. We also focus on people who are a culture fit with us and are passionate about our mission."

She gives the example of a recent search for a user-experience expert, a talent category that's in high demand as companies prioritize mobile development. The position had been outsourced -- and after interviews, the company kept it outsourced, she says, because it didn't find a person with deep skills and a fit with the company's mission.

CIOs echo the need for deep experience. "The broader skill sets, I think you'll see those in analyst roles, Scrum-master-type roles …some management roles," says David Wright, CIO of McGraw-Hill Education. "But more and more, the hands-on coders, we're looking for people who are just really deep in whatever discipline we're trying to hire."

Giorgos Zacharia, CTO of online travel company Kayak, says he's having a hard time finding UI engineers and mobile developers, noting that he seeks both entry-level and experienced people. Kayak offers great perks and pays generously, he says, yet the company still struggles to fill open slots even with its proximity to Boston and wealth of local universities. Paying dividends for Kayak are the three internal recruiters it has hired since 2013 and the hackathons it has attended to connect with talented IT pros.

Even so, Zacharia this year turned to holders of H-1B visas -- which let non-US citizens work in the US in a specialized field for up to six years -- to fill six slots, and he expects the company to do about the same level of H-1B hiring in 2015. Kayak is also hiring more people overseas, especially in Berlin, he says.

Seeking Mr. Right
For employers, hiring can feel like dating: You spend a long time looking for the perfect match. But how many chances will you take? How flexible will employers be during the hiring process? This is where both the recruiters and the job seekers voice exasperation.

Tracy Cashman, senior VP and partner in the IT search practice of WinterWyman, sees a genuine talent shortage. "There are more jobs than people who are skilled," she says. While she's starting to see an uptick in engineering graduates, "we've been feeling this since the [dot-com] bubble burst," Cashman says, when college students were worried that all IT jobs would move to India. "And we're still fighting that," she says.

On the flip side, some employers have become "persnickety," says Cashman, who advises CIOs to remove their perfection goggles. Companies wait too long to fill open positions, which not only hurts the business but also heaps extra work on the existing team. Delays also turn off qualified candidates, who assume that if a slot is open too long it's like an unsold house that has "issues."

You don't see the "best available athlete" mentality, Cashman laments, referring to the professional sports strategy of signing the best player available rather than hiring a lesser player to fill a specific position. Hire a smart, creative person who's eager to learn, and train that person on the rest, she advises clients, before the other valuable people on your team walk out or you blow the business deadline.

What are the ramifications of the so-called IT talent shortage and unfilled slots? Among the respondents to our survey who work at large companies, 79% cited delayed IT projects, 48% cited poor-quality IT projects, and 33%

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cited missed revenue opportunities. That last point should grab IT leaders' attention; it's sure to grab the CEO's.

The only category where Cashman sees IT groups regularly willing to bring in people and train them for the job is help desk positions, which are among the lowest-paying, least-training-intensive positions.

Some employers must experience serious pain -- a missed revenue target, a delayed product launch, or a customer service blow-up -- before taking off the hiring perfection goggles. "Even then," Cashman says, "contractors often are brought in to fix the pain. It's wait, wait, hurry."

Holes in the screens
That scenario sounds familiar to IT veteran Stuart Lathrop, now a marketing enterprise solution architect for ESAB, a welding and automation equipment supply company.

Midcareer IT pros know Lathrop's recent job hunt story all too well. Job hunters struggle to make it through the first electronic filters of resumés, and when they do, the follow-up phone screenings prove frustrating. Interviewers show little willingness to bend on specific technical requirements or to consider transferable skills.

In 2012, Lathrop voluntarily left a full-time IT job (at a time of change within the company), did independent consulting for about a year, then started to look for a new full-time role in the fall of 2013.

"The only people I could have a conversation with were headhunters and recruiters," he says. "The on-site interview would be the first time I would talk to anyone who had IT experience."

He cast a wide net online and generated an application-response rate of 12% to 15%. But the callbacks were mostly for junior roles, for which he knew he was overqualified. "If I'm hiring, I don't want someone to undersell themselves to fill a role," Lathrop says. "They're going to be bored and won't be with you long."

Lathrop won his current role after a contact recommended him to come in and solve a thorny problem. He solved the problem and worked as a contractor for about eight months, at which point ESAB created a position for him. "That's a trend, bringing someone in as a contractor," he says. "Frankly I've used it myself."

What concerns Lathrop is the disconnect between HR and IT. He cites trust and language issues. For instance, if he's looking at the resumé of someone who says he has run an Oracle shop, using versions X through Y of a system, he would realize why that experience is a good match, even for a role keyed to a different software system. "I know what's involved in running an Oracle shop and having that kind of longevity," he says. "HR doesn't understand our side of the business well enough to make those interpretations."

A better approach, Lathrop says, would be for HR to sort candidates into an A pile and a B pile and let IT see all of them, before people are green- or red-lighted for in-person interviews. But that, of course, takes time. [ Editor's note: As this story was publishing, Lathrop learned his full-time job at ESAB is going away as part of a reorganization. In November, he will once again be a contractor with the company. ]

Adrianne McDonald had 17 years of IT experience and was working in a director-level infrastructure service delivery position for Time Warner Cable, running back-office disaster recovery efforts, when she began hunting for a new job in the fall of 2013 because of a reorganization.

"I was surprised when I came out at the difference in job hunting versus 2002," McDonald says. "About a third of the time, people contacted me for positions that were completely inappropriate." Although she was seeking a senior infrastructure position, she got calls for everything from entry-level business analyst to data mining roles. Whatever the recruiters were using to match job openings with candidates, it wasn't working. "I wanted to ask about the algorithm," she says.

McDonald was careful to apply only for positions in her wheelhouse, so she got a call back from an outside recruiter or HR pro about 70% of the time, she estimates. But to no avail. "When I got on the phone it was painful," she says.

The recruiters were always in a rush, McDonald says, but they weren't asking the questions that would have matched her or ruled her out in an informed way. "It's one of those pay now or pay later situations," she says.

McDonald didn't find the right position, and in December 2013 set up her own consulting firm, Transformation Leadership, where she does IT transformation and leadership development projects. Her decision to go solo -- the same route Lathrop took earlier in his career -- isn't unusual among midlevel IT pros. Some move back and forth several times between solo and company jobs. The most common reason to do contracting or consulting work is higher pay, our InformationWeek Salary Survey finds. Just 10% of managers and 28% of staffers who went that route say it's because they couldn't find full-time employment.

The only piece of good employment news I heard consistently -- and I heard it from almost every single recruiter and employer I spoke with -- is that it has become easier for IT pros to switch between industries, if you have deep experience in a desired skill. "Almost no one in our engineering team had travel experience," says Kayak's Zacharia. "We believe good technical skills easily transfer."

Especially when it comes to red-hot skills such as big data, companies have had to become more flexible on industry knowledge. "I tell them if they're looking for consumer packaged goods experience, they'll be looking a very long time," says Linda Burtch, founder and managing director of executive recruiting firm Burtch Works, which specializes in data analysis roles. Are companies now wise to that reality? "They tend not to be at the beginning of the process," she says, "but then they get there."

Companies innovate to draw talent
Some companies are getting creative about marketing themselves to and courting top tech talent.

Online retailer Gilt hired Lauri Apple as its technology evangelist about two years ago. Her job: to promote the cool projects and technologies that power Gilt.

"Really great talent will find a job," Apple says. "They're working already. You have to think of getting those folks as a long-term strategy, so you can get them when they're ready."

For example, Gilt offers day-long courses on hot skills such as Scala and Hadoop, taught by experts, and has tech gurus such as former Netflix cloud architect Adrian Cockcroft come in to speak. Gilt invites the local tech community to attend and builds in time for networking.

"What I'm set up to do is raise awareness of what's going on here, … and hopefully that will inspire people to apply," Apple says. Does she know anyone else in a similar role? No -- but she's getting more calls to discuss it. "I think you're going to see more of this competitive culture develop," she says.

Another best practice is to get involved with the informal networks that IT pros develop within their specialty areas. (You've experienced one if you've been to a cloud computing conference.) "We've seen companies be successful networking into those groups," says Yoh's Rivera, referring to events, user groups, and associations. "Get to know those groups … and then be respectful when you have openings." It's a give and take -- companies need to offer up their time and expertise to the community in order to connect with potential hires.

Meantime, don't just recycle old job descriptions, Cashman warns. IT and HR need to talk about the status of the project they're hiring for and the specific project challenges. And don't overload job descriptions with a dream list of skills. "If you miss the passive job seeker who thinks, 'They won't go for me because I don't have three of the 10 things required,' you do yourself a disservice," Cashman says.

Think of your job description as a place to sell your organization's culture. Gilt sells the fact that its tech people "get to work with a CTO who still codes," Apple says. Best Doctors touts its culture of tinkering.

When we asked in our survey about top obstacles to IT hiring, 50% of respondents at large companies cited low salaries. A significant 41% cited unrealistic expectations about skills and experience -- expectations that feed job descriptions.

Both IT pros and hiring managers must adapt to the fact that tech skills are changing faster than ever before. In the past, a networking or security pro could confidently craft a three-, five-, and maybe 10-year career plan. Those long paths aren't clear anymore.

Your next job hunt will be different, as McDonald found. Your technology niche may start hot and turn cool. Personal networking and project portfolios are as important as ever, even for entry-level roles. For more job hunt tips for new IT pros, see our related article: 9 IT Job Hunt Tips For Beginners.) Leaders like Bill Martin, CIO of Royal Caribbean Cruises Ltd., say that's just how IT careers work in the age of digital business.

"I've been the CIO at Royal Caribbean for seven years," says Martin, "and I like to tell people I'm in my third generation of IT, because it cycles about every three years, and the toolsets are completely different. How you approach problems is different. How the business looks at technology changes. If you want a career in IT, you need to be ready to change."

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