Employers are entering 2022 with lofty digital aspirations, but a tight hiring market looms ahead. Employees are fully aware of how crucial they are to operations — and how much companies are willing to pay them.
This tension depicts the dynamics playing out in the tech labor market in 2022. Tech occupations are in high demand, with no sign of slowing down. This gives tech workers the upper hand, and leaves organizations to adjust policies and strategies.
Tech firms added 11,000 workers to their ranks in December, the 13th consecutive month of employment growth for the industry, according to a CompTIA review of data from the U.S. Bureau of Labor Statistics.
Employers across industries hired 180,000 technologists in December, and tech unemployment hit 2% — nearly half the national unemployment rate, which sat at nearly 4%.
Companies are expected to rely more heavily on digital infrastructure in 2022, as automation and software become critical to operations. This fuels the need to hire and results in higher mobility for workers in high-demand areas, another trait of the tech labor market ahead.
Here are five workforce trends to watch in 2022:
1. The 'job' concept is becoming dynamic
Companies have struggled for years to attract enough tech talent to their ranks. One strategy employers have turned to is reskilling their existing workers, leading job descriptions and titles to become more flexible than in the past.
"Jobs have become more dynamic," said Phillip Alexander, CEO of Pragmatic Institute. As organizations adjust what skills they need to operate, employees are aware they can reinvent themselves with skills training.
More than half of tech leaders plan to cross-train workers from other parts of their company to meet talent needs, according to the 2021 Harvey Nash Group Digital Leadership Report.
Employees learned during the pandemic they had more to offer, often outside their specific job description. "It's our job as employers to make sure they reinvent themselves to stay in the organization and not leave," Alexander said.
2. Employees want work that challenges them
In a hot labor market, employees are motivated to shift roles mainly due to financial reasons, but career opportunities are closely behind as a key driver.
Six in 10 technologists considering a move say salaries are their primary driver, according to a CompTIA survey. But more than half say their top motivators are better career options and long-term opportunities.
Top tech employees need to constantly feel like they're "engaging their mind, constantly staying sharp, or they actually feel like they're degrading a bit," Phillippe Lanier, CEO at EastBanc Technologies. A challenging role with opportunity ahead can contribute to retaining and attracting scarce technical workers.
"While a lot of the job offers that come along may be financially more attractive to them, they're not as attractive in terms of a direct challenge," said Lanier.
3. More worker mobility ahead
Labor dynamics among technologists was marked by high staff turnover last year. With employers actively seeking to fill their vacancies, workers scouted the field and took better opportunities. In 2022, mobility will continue to drive the talent market.
"All signs point to a continuation of a frenzied tech labor market with many employers in hiring mode and many tech professionals in 'opportunity consideration' mode," said Tim Herbert, EVP of research and market intelligence at CompTIA, in an email.
Nearly half of tech professionals were looking at new employment opportunities, according to CompTIA data, which covers workers actively job hunting and those open to considering new opportunities.
CIOs searching for talent will need to contend with the pressure of a tight labor market, Herbert said.
4. Expect hybrid work to keep shaping strategy
The experience of 2020 taught most companies that hybrid work was possible — even if just partially, since some roles don't lend themselves to operating remotely.
Remote hiring, too, became a possibility once the geographic limits of employment vanished. A more virtualized hybrid work environment will continue to allow companies broader access to talent, according to Ken Englund, Americas technology sector leader at EY.
"If you can look well past the Bay Area in terms of talent, you've really expanded your opportunity," said Englund.
The flip side of broad talent access is that any company in the world with a remote hiring policy is now a threat, potentially luring top talent away.
Within the range of work experiences, companies can use the operating model of choice as a differentiator. Ultimately, employees will determine what kind of business they want to be in, whether that's a remote-first or an in-office organization.
"That will become more of a decision-making criteria for people," said Englund.
5. The rise of non-traditional career paths
Employers struggling to fill their vacancies should try looking at candidates that don't necessarily match the stereotypical tech profile.
Most technical recruiters already consider skipping resume and academic requirements while assessing candidates, and four in 10 say they regularly find potential hires with nontraditional backgrounds.
"Every study shows more diverse companies perform better," said Al Smith, CTO at iCIMS. To become a more diverse and inclusive organization, leaders must hire people from non-traditional paths into technology.
"That's something that we're seeing in the data as well: Employers are now looking at hiring people in non-traditional paths," Smith said.