How COVID-19 has affected tech-hiring trends in the UK

As the UK braces itself for a second wave of coronavirus, specialist recruiter Robert Half uncovered some of the challenges businesses have faced throughout the pandemic and how they impact hiring trends.

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For companies based in the UK, the ongoing COVID-19 pandemic, the related recession and a Brexit negotiation that is likely to end without a deal have made this a tough year for business.

And not surprisingly, all of those factors are affecting hiring and retaining workers, according to  specialist recruiter Robert Half. The company's research indicates that more than 86% of UK businesses fear losing top talent as a result of the pandemic, with a third of organisations worrying that necessary salary reductions will lead to an exodus of employees.

In fact, more than half of the CIOs surveyed indicated flat salaries for tech workers over the next year — and more companies are accounting for remote workers' location when calculating salaries for new employees.

The recruiter, which has reported on salaries since 1950, spoke to 1,502 executives from Belgium, Brazil, France, Germany and the UK to gain a better insight into the issues currently facing businesses and key trends likely to emerge in the future.

Retaining top talent remains a challenge

One of the biggest challenges identified by Robert Half was the ability to retain top talent. Although many white-collar workers have been able to carry on by working from home, companies across all sectors are having to tighten budgets as traditional revenue streams collapse. As a result, a significant proportion of businesses fear not being able to pay market rates for their employees.

Of the executives surveyed, more than a third cited salary reductions and an inability to increase wages as their main concern in the near future. Of those CIOs who expect to keep salaries flat for tech-focused employees, most companies are pledging to keep pay at pre-COVID-19 levels to boost retention.

In the UK, the dramatic increase in remote working is affecting wages as managers use different approaches to calculate starting salaries for new hires. Although 42% of UK firms currently use their business’s location to benchmark remuneration, 28% focus on the applicant’s location, and 26% use a combination of the two.

"Tech-focused workers, in particular, have been stretched to the limit during the pandemic with many companies speeding up their digitisation efforts and/or deploying new technologies in response to the current pandemic," said Matt Weston, managing diector of Robert Half UK.

He noted that teams have been putting in longer hours, taking on additional responsibilities and acquiring new skills, causing some to reassess career priorities or take a closer look at the true market value of their skills.

Employee compensation still matters

No matter the economic outlook, top talent usually expect to command top tier salaries, but the pandemic has forced companies to reassess the benefits they offer in an effort to find non-financial incentives to keep workers with the business.

Looking to 2021, although financial compesation will remain a top priority, Weston said employers should consider remote and flexible working as an essential employee benefit when feasible. Mental health resources and assistance, wellness programmes and providing an at-home office equipment allowance are amongst some of the other benefits now being offered by the UK companies Robert Half spoke to.

Its research showed that the ability to work from home is the number one in-demand incentive for employees. As attracting and retaining talent continues to be a top priority, adapting to a new digital workplace will not only provide existing employees with an improved work-life balance, it also allows employers to better integrate inclusivity into their hiring practices, opening up roles to candidates who might not be able to work in a traditional office environment.

“While the opportunities to increase remuneration may be tricky in the coming months, employers should research compensation trends regularly and be prepared to move quickly and negotiate effectively — using both financial and non-financial benefits — in order to retain key employees or hire promising talent,” Weston said. “Companies that do not adapt or embrace these new ways of working risk losing key talent.”

Future trends: accelerated digitisation

Although the short-term outlook is worrying for many businesses, the research did identify interesting future trends.

The pandemic has forced employers to increase the pace of digitisation, with many businesses accelerating timelines on digital transformation projects. Weston says that among Robert Half clients, there is high demand for software engineer, UI/UX designer, devops and cloud infrastructure roles.

“These roles were coveted pre-COVID and we expect demand to accelerate throughout the rest of the year,” he said.

Furthermore, while salaries across the tech sector are expected to remain stable for the time being, financial services, fintech and the public sector have all seen a marginal increase in salaries.

Robert Half also observed many companies transforming how they work as a result of the pandemic. According to Weston, businesses are investing in new platforms, re-skilling employees and evolving hiring and recruitment strategies to knock down geographic barriers. These shifts aren’t without their challenges, he said, often requiring organisations to provide additional support and training for remote team members and introduce or boost employee benefits to maintain productivity and morale.

Business leaders appear likely to continue to tackle these challenges head on, with 71% of managers pledging to offer remote work going forward, with flexitime and compressed work weeks also gaining popularity

“Without a doubt, unemployment in the UK has risen as a direct result of the pandemic, but the impact of COVID-19 has been far from uniform across all industries,” Weston said. “There are still opportunities out there — a considerable number of them driven by the shift to remote working.

“Professionals with in-demand technology skills will be core to business recovery over the coming months, and employers need to offer competitive salaries and benefits to retain key personnel, as well as to attract and secure top candidates for the remainder of 2020 — and beyond,” he said.

Copyright © 2020 IDG Communications, Inc.

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