An evolving hiring landscape

Understanding the shift in market conditions

After years of rapid growth, the IT and Delivery (IT&D) hiring landscape is evolving. Compared to last year, job numbers have declined by 39%, and recent data shows a 4% month-over-month industry-wide increase in applications per job ad, indicating heightened competition among candidates*.

However, before you sound the alarm, it's important to note that this trend is not exclusive to the tech and delivery sectors and isn't as concerning as it might seem at first glance. Here's why…

"There's been a lot at play these past couple of years."

This shift is a reflection of a broader market adjustment occurring post-COVID. During the 2021/22 boom, companies made substantial investments, some of which included mergers, acquisitions, and extensive compliance programs (which have since been completed). There was also a rapid push towards digital acceleration and the effect of our closed borders, which created an artificial bubble for the tech sector. Combine all these events, and it makes sense why we ended up with a significant talent shortage and subsequent salary hikes.

Another aspect to consider is the typical market slowdown towards the year's end - an event to be expected. However, in 2023, this slowdown has been more pronounced (and started mid-year), influenced by factors such as the extended election process, major weather events, the cost to borrow that has affected businesses ROI and the ongoing cost of living crisis. All of which have contributed to an overall sense of fatigue and uncertainty.

Now, with the market beginning to return to normal levels, we're seeing that talent shortage ease and salaries start to level off (promising news for employers). Businesses are therefore, realigning their budgets and planning strategies, gearing up for 2024 with a more balanced and thoughtful approach.

Entering a new phase of the IT&D Recruitment Landscape

Encouragingly, it seems companies are pinpointing priority projects for the new financial year that could generate various opportunities in market. Whilst they strategise, their focus looks to be shifting towards more effectiveness within the workforce.

Gone are the days of simply hiring to fill seats. Instead, companies are seeking high-calibre individuals who can make a genuine impact.

What does all this mean for employers?

For employers, it signifies a talent market that is becoming more balanced, not necessarily tipping in your favour but levelling out from the frenzied heights of recent years. However, it's important to note that high-quality candidates remain in high demand and the market is still short in areas like Big Data, Cloud and Software Development. Attracting these candidates requires strategic recruitment strategies with strong networks and experienced head-hunting skills.

Also, as we often see in times like these, self-managed recruitment becomes challenging and time-consuming for many businesses as they are inundated with applications to screen, often failing to yield the desired quality of candidates.

So, what about candidates?

Well, those of you who were receiving multiple calls per day from recruiters might find the phone a little bit quieter these days. But, while the IT&D job market isn't as buoyant compared to the height of Covid years, it doesn't mean opportunities have dried up - just that they might not be as abundant as before.

This further highlights the need to be more prepared for your job search due to the rise in competition for roles and have realistic remuneration expectations to meet the market.

Looking ahead with cautious optimism

While it’s not like it used to be, the IT&D market is far from stagnant but rather returning to pre-COVID 'normal' levels. Opportunities are still out there but in a more balanced and thoughtful market.

Companies adjusting their budgets and strategies for the upcoming year suggest exciting prospects for new projects and opportunities. As with anything, it will come with its challenges, but it will also bring opportunities for both employers and candidates alike. So whether you’re a candidate job seeking or a client talent finding, the next 12 months are about navigating this evolving landscape with adaptability and strategic foresight, ready to embrace the new dynamics of the IT&D sector.

If you’re searching for talent, planning next year's hiring strategy or just need someone to bounce ideas off, get in touch - we’re here to help.

Authors:

Sarah Quintal | Team Manager - Enterprise & Transformation

Mike Messenger | Team Manager - IT & Digital

Resources:

*SEEK Employment Dashboard - October 2023