According to iDTech, “The dilemma in tech is that there are too many jobs, not enough workers. Not exactly what you'd expect with the country walking a pandemic tightrope with over 8.4% unemployment (according to the Bureau of Labor Statistics). There are millions of unfilled jobs, not enough workers.”
A few key takeaways of this claim are as follows:
Amazon (AMZN) recently announced that they were ramping up investments in corporate and tech jobs, looking to hire 33,000 new employees with annual compensation packages at $150,000 (Source: CNN Business).
Netflix Inc. (NFLX) founder and co-chief executive officer Reed Hastings said the company has been and will keep hiring through the uncertainty of the COVID pandemic (Source: Bloomberg).
Facebook (FB) COO, Sheryl Sandberg, told CNBC earlier in the year "that the social media company expects to hire an additional 10,000 people by the end of 2020." The majority of the hires will be in the highly-compensated product and engineering roles.
iDTech also pointed out that “The market cap of Netflix has doubled in the past year and was trading at $254 a share a year ago. It’s now hovering at around $500. Alphabet is up about 50% for the same period, and Amazon is up about 80%.”
What This Means
To remain competitive in this digital era, businesses will need to adopt emerging technologies, modernize their workforce, and propel operational efficiency to accommodate incoming changes across the globalized economic landscape.
This means that they will need to upgrade legacy systems, hybridize private, virtual and cloud-based networks, and protect all corporate assets from theft, loss, and/or corruption due to breach or system failure.
This also opens the door to new jobs and new opportunities for those across the Tech Sector. But, what happens when there are more jobs than people and businesses are desperate for innovation?
The Current State of Our Economy
According to the United States Bureau of Labor Statistics, the total nonfarm payroll employment declined by 140,000 in December, and the unemployment rate was unchanged at 6.7 percent. This does not include those jobless, who are no longer falling into the “unemployment” category due to exhausted benefits and considerations. This also does not include small business owners and the self-employed, who are struggling to maintain and acquire new businesses due to the Covid-19 pandemic.
Also not accounted for are lost wages due to a cut in hours, the inability for employers to pay previous wages or minimum wage workers counted twice, working two or more jobs just to get by. Gig workers, however, are more than likely factored into this equation, but it’s unclear just how many of these positions are relying on commission to make a livable wage.
These numbers constitute December reporting and do not include lost major contracts that would normally be renewed at the beginning of a new year or the massive layoffs experienced by long-term workers across industry. Notably, December job losses in leisure, hospitality and in private education were “partially offset by gains in professional and business services, retail trade, and construction.”
With many stores closing or operating with limited control, businesses took a significant loss in retail traffic, especially during the Holiday Season. Usually in-demand, seasonal workers weren’t necessary and often went without during such a crucial time in World History.
Both the unemployment rate, at 6.7 percent, and the number of unemployed persons, at 10.7 million, were unchanged from the previous month. Although both measures are much lower than their April highs, they are nearly twice their pre-pandemic levels in February (3.5 percent and 5.7 million, respectively).
Among the major worker groups, the unemployment rates for teenagers (16.0 percent) and Hispanics (9.3 percent) increased in December. The jobless rates for adult men (6.4 percent), adult women (6.3 percent), Whites (6.0 percent), Blacks (9.9 percent), and Asians (5.9 percent) showed little change.
The number of persons jobless less than 5 weeks increased by 449,000 to 2.9 million, while the number of persons jobless 15 to 26 weeks declined by 303,000 to 1.6 million. The number of long-term unemployed (those jobless for 27 weeks or more), at 4.0 million, was essentially unchanged in December but has increased by 2.8 million since February. The number of those jobless for 27 weeks or more accounted for 37.1 percent of the total unemployed in December.
The number of persons employed part-time for economic reasons, at 6.2 million, decreased by 471,000 over the month. This measure is down from its April high of 10.9 million but is 1.8 million higher than the February level. These individuals, who would have preferred full-time employment, were working part-time because their hours had been reduced or they were unable to find full-time jobs.
Among those not in the labor force who currently want a job, the number of persons marginally attached to the labor force, at 2.2 million, changed little in December but is up by 749,000 since February. These individuals wanted and were available for work and had looked for a job sometime in the prior 12 months but had not looked for work in the 4 weeks preceding the survey.
The number of discouraged workers, a subset of the marginally attached who believed that no jobs were available for them, was essentially unchanged at 663,000 in December but is up by 262,000 since February.
The tech occupation unemployment rate was 3% in December, compared to 6.7% for the overall economy. This is likely due to the lack of qualified candidates and a shift in how we do business. Tech unemployment started 2020 at 3% and ranged from a low of 2.4% to a high of 4.6% during the year.
Tech Hiring Stood Out in the December Jobs Report
"Tech hiring continues to bring a degree of stability to a still-fragile labor market in an incomplete recovery," said Tim Herbert, Executive VP for Research & Market Intelligence at CompTIA. "With projections of employer demand for tech talent remaining strong in the year ahead,” he continues, “we hope tech can continue to serve as a catalyst for business and career opportunity."
CompTIA, the nonprofit association for the IT industry and workforce, revealed in their 2020 Tech Jobs Report that employment, across the US IT Industry, increased by a net 22.2K workers, while global IT occupations grew by an estimated 391K in December, alone.
In fact, hiring within the IT sector “was paced by the addition of 20.3K jobs in the IT services and custom software development category, as well as in the employment category, an important indicator of small and medium-size business activity.”
Per the report, “during 2020 the U.S. IT sector recorded six months of employment growth and six months of job losses. IT occupation employment experienced seven months of growth and five months of declines in 2020.”
In December, an additional 391K new positions represented the largest monthly gain of the entire year.
Data processing, hosting and related information services increased by 2,600, while computer, electronics, and semiconductor manufacturing, an industry set to reach $95.9B by 2025, increased by more than 1600 new vacancies. Telecommunications declined by 2,500 jobs, while other areas increased by 200+.
Tech Job Postings Were Up
Despite the rest of our looming economy, technology-related jobs were up. The 2020 Tech Jobs Report describes a “modest increase (to 207K) in the number of employer job postings for core information technology positions” in December.
The report also notes that:
Software and application developer openings accounted for the largest share (of the 207K) with a total of 62.9K. IT support specialists (18.1K), systems engineers and architects (16.6K), systems analysts (13.7K), and IT project managers (13.5K) were also in demand.
Industries with the largest number of tech job postings included: professional, scientific, and technical services (38.2K), finance and insurance (18K), manufacturing (14.9K), and information (12.4K).
Among metropolitan areas across the country, New York, Seattle, San Jose, Chicago, and San Francisco saw the largest month-over-month increase in tech job postings.
At the state level, Washington, California, New York, Michigan, and Illinois experienced the strongest month-over-month gains.
Employer hiring for emerging tech job roles and skills reached 57.5K for the month, a slight increase from November. As a percentage of overall technology job postings, emtech (emerging technologies) accounted for 28% in December, up 6 percentage points over the January 2020 rate of 22%.
The definitive guide to national, state, and metropolitan area tech sector and tech workforce analytics, CompTIA’s CyberStates, shows the following industry states, tech-wide:
A net 12.1M are employed in tech, nationwide.
307K new tech jobs were added to the US economy in the past year.
1.6M software and web developers were employed in the last year – the largest and fasting growing category of tech jobs, overall.
There were 4.6M+ job postings in tech during 2019, with nearly 822K postings occurring in emerging technologies.
There is an estimated $1.9T in direct economic output from the Tech Industry, representing 10% of the national economy in its totality.
The median wage for Tech is nearly double the median wage of all occupations, nationally.
There 557K tech firms in the U.S. with 13.4K startups launched in 2019, alone.
Tech has ranked 4th in job creation since 2010. This is among 22 other top-level occupations across the country.
Challenges & Barriers to Entry
In 2019, ZDNet reported that going into 2020, the IT Industry, we needed to face a few harsh realities, head-on, if we wanted to see progress going forward. We were reminded that the gender gap is still “a major thing” and that a significantly higher amount of women apply than are actually hired.
In fact, only 27% of applicants are women and they continue to make up only 24% of all new hires. Considering that more than 200 people will apply for each open position, this number should be much higher and there should be fewer roles that remain vacant across the country. As of 2019, there were only six positions filled for every 10 new positions in the market.
“Despite a large number of unfilled positions,” states ZDNet “there were, on average, 43 applicants for every tech hire in 2018 (up from 36 in 2016), compared to 21 applicants for every (all types) hire. The increasing number of tech openings is attracting an increasing number of tech applicants.”
This claim comes with the fact that employers are finding it increasingly difficult to recruit qualified candidates, even though there is an increasing number of applicants for several of the most-needed positions. One begins to question whether this comes from the ever-changing growth of the industry or if the constant evolution of said technologies is leaving us further and further behind.
The cloud-based talent acquisition platform iCIMS analyzed applicant data for new hires across the US economy. The following charts come from its benchmark report on hiring from January to May 2019:
One state seeks employment for its citizens, building a digital workforce in the midst of a pandemic
In September, the State of Ohio began offering its residents the opportunity to jump-start or further their careers in tech, manufacturing, and project management. Through the Individual Microcredential Assistance Programs (IMAP), participants would begin earning essential training and certification that would allow them to evolve in the face of a global pandemic.
These credentials would also position them for more competitive roles in the greater economic environment.
Generally, low income, totally or partially unemployed Ohioans would receive a micro-credential at no cost and would be allowed to select an affiliated program of their choice. On the small business front, the state would also provide businesses with similar training, through the TechCred Program, which would also allow them to modernize their current infrastructures and to establish innovative business models, allowing them to compete across the global marketplace.
In January, there were more than 400K tech jobs available in Ohio, alone, making their TechCred and IMAP initiatives well worth the investment. This is what CompTIA’s CyberStates had to share about technology in the State of Ohio, as of the beginning of this year:
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