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Corporate Strategies

The Top 3 Talent Challenges Facing Enterprises Going Into 2023

General Assembly
December 14, 2022

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We’ve been hearing it for over a decade: there isn’t enough tech talent to meet rising workforce demand. This story is nothing new—enterprises have struggled since well before the pandemic to attract and retain technically inclined candidates, let alone diverse technical talent. In a to-come study, we found that 90% of HR leaders are concerned that they won’t be able to fill their open tech positions.  

Hold on, we know what you’re thinking: we’re entering a global recession. This may be true, but the fact remains: the tech skills required to stay afloat—let alone compete—are on the rise, without talent to fill the gap. And the gap is substantial, with nearly seven times as many current job openings there are annual computer science graduates. In fact, as of October 2022 Comptia reported 317,000 tech job vacancies in the US alone. 

But businesses aren’t the only ones struggling to connect the dots. According to a recent study from LHH, 77% of workers are aware that they have a skills gap. The shortage is particularly prominent in individual contributor roles—where only 36% say their company invests in the skills employees need to get the job done. These workers are often left either feeling stuck in undesirable positions—or forced to seek opportunities to grow elsewhere. 

As we enter a new year with new challenges, what will technology and talent leaders have to look out for in 2023? 

  1. Tech delays due to talent shortages

Stretched-thin and maxed-out tech teams have been forced to do more with less. According to a recent survey by Gartner, IT executives view the talent shortage as the leading barrier to adopting 64% of emerging technologies that enable innovation—up from just 4% of those surveyed in 2020. In other words, companies are finding it difficult to innovate and automate because they lack qualified professionals capable of maintaining the technology needed to evolve and future-proof their businesses. Remarkably, this is despite the tech layoffs making headlines of late. Companies like Twitter, Salesforce, and Meta are making massive workforce cuts—yet unemployment among tech candidates is still low.

In the beginning, when digital transformation first started to become a hot topic among enterprise leaders, many wisely prioritized new technologies, but ended up not being able to acquire or develop the talent necessary to implement and manage those technologies at the same pace. COVID-19 pushed digital transformation efforts several years forward, thus enterprises needed an army of skilled IT talent to succeed. Fast forward to 2022 and businesses are falling behind the curve because they still don’t have the right skills in-house. 

Meanwhile, long hours, crushing workloads, and vanishing work-life balance are all taking their toll on the talent that companies actually do have. A recent survey of more than 36,200 IT professionals across 33 counties found that two in five workers are at high risk of burnout—which leads to turnover. All the while, technology leaders are making big promises, but few are actually meeting their deadlines. 

How to solve this issue: 

Bring your talent along for the ride. The key to making good on your digital transformation vision?: Give your people the tools they need to be successful. While tech talent may be scarce, your people are concerned—and eager to develop their skills for the future of work. Give them opportunities to upskill and reskill into the tech roles of the future… because the future is here. 

Stop looking in the same places for tech talent. It’s easy to get comfortable with traditional methods of recruitment—but don’t. Consider partnering with talent builders, like General Assembly, to fill gaps within your software engineering, data or UX teams. You won’t be sorry. 

2. DEI goals not being realized 

Businesses should aim for more diverse workforces because it’s the right thing to do—not to mention the now-widespread knowledge that a variety of perspectives drives innovation and market growth. In 2020, after the murder of George Floyd, businesses pledged to diversify their workforces, but few have made real, tangible progress on their goals. In a recent study (coming soon), we found that 87% of talent acquisition leaders admit to not making progress on their DEI goals. 

This isn’t for a lack of trying, however. Businesses have created DEI resource groups for employees, appointed DEI executives, made public statements about their DEI commitments, and rolled out DEI road maps for building a more diverse workforce. And yet, between 2015-2020, according to research from McKinsey, only a third of the 1,000-plus large firms in 15 countries tracked made any meaningful progress—and the remaining two-thirds flatlined or fell backward. 

However, businesses continue to look for talent in the wrong places, relying on outdated measures of success, like the college degree. But more than 70 million workers in America don’t have a college degree—which totals about half the workforce. Here lies a tremendous opportunity for employers to access talent they need, while also making progress on their DEI objectives.

How to solve this issue: 

Consider rethinking the way you evaluate potential talent. More specifically, move to a skills-based hiring practice vs. merely hiring based on traditional credentials like a college degree. Many tech roles are skills-based jobs—so if someone has the skills to do a job, they don’t necessarily need the degree.

One quick-win activity to make headway on your DEI goals is to remove the college degree from your screening methodology; another is to make sure you have a diverse interview panel to ensure fairness in the process. 

If you feel ill-equipped to navigate the recruitment process with a non-traditional candidate, seek counsel with someone who understands this non-linear career path. General Assembly, for example, has worked with technology leaders and talent leaders across the globe, and is capable of creating a pipeline of largely non-traditional junior tech talent that’s sourced, trained, and deployed to suit an organization’s needs—including diversity goals. 

3. Lost ROI due to tech talent turnover 

Harvard Business Review reports that the turnover cost can add up to 300% of the replaced employee’s salary. Over time, that adds up to a lot of dollars wasted. The issue is urgent: according to a recent study from LHH: 3 in 10 workers want to leave their jobs in the next year, and among those looking for a change, 45% are actively applying or interviewing for a new role. What are the various reasons tech talent doesn’t retain?

A competitive market, for one. According to the LHH study, salary is the #1 reason for workers to change jobs. And only 4 in 10 non-managers feel their salaries are fair. This puts organizations in a double-bind. Salaries going up due to the tight labor market, and at the same time companies are all competing for the same small (and seemingly shrinking) pool of tech talent. 

Inflexible work is another. The COVID-19 pandemic changed the world of work forever, forcing workers to work from home. While this was challenging for many at first, workers got used to—and started to enjoy—the increased flexibility and productivity they received as a result of working from home. According to an LHH study, 6 in 10 desk workers are considering or have already changed jobs as a direct result of wanting more flexibility. 

Finally, lack of growth opportunities. According to an LHH study, 44% of workers who wish to stay at their company want the opportunity to upskill or reskill into a new role. And 23% of global workers have never had a career progression conversation with their manager. 70% of workers agree that organizations should train, upskill or develop existing employees for different roles across the organization before looking outside. 

How to solve this issue: 

Rethink the way you’re searching. Consider building your own talent pipeline by partnering with a recruit-train-deploy company like General Assembly or by looking to reskill and redeploy talent internally. 

One reason that recruit-train-deploy is a particularly effective method is because engineers are often deployed with the support of more senior engineers, thus allowing a learning-while-earning experience. We’ve found that when you take a chance on talent and invest in them by giving them valuable skills, their sense of loyalty to your business grows. That’s why GA talent retains. We have a retention rate of 91% after two years and 81% after three years.

Meet your workers where they are by offering them both flexibility and opportunities to grow with your business. While salary is an important part of work, employees often stay longer at businesses that care about them both personally and professionally. As the old adage goes: People leave their boss, not their company. 

Solve these problems with Recruit-Train-Deploy by General Assembly & LHH 

General Assembly is the world’s #1 technology training provider, with over 80,000 global alumni and over 5,000 graduates annually. We partner with LHH, which is the #2 largest recruitment solutions firm in the US, with over 30,000 placements per year. 

We help businesses attract and retain diverse tech talent. Our graduates feature:

  • 33% female candidates
  • 60% from underrepresented groups 
  • An average 6 years of prior work experience 
  • Graduate placement in 70 of the fortune 500 companies

What is Recruit-Train-Deploy (RTD)? 

  • Recruit. We source learners using a rigorous admissions process that allows us to identify the right mix of attitude and aptitude to be successful. Our retention numbers are best-in-class. 
  • Train. We are the #1 tech boot camp, offering an unmatched cutting-edge curriculum in the industry. On top of that, we can tailor programs to get talent ramped up as quickly as possible. 
  • Deploy. We deploy our workers into your business along with a dedicated squad leader who will coach and mentor them throughout the length of the engagement. You’ll have the option to hire our talent full-time.. 

2023 is coming fast. If you’re interested in working with us on your workforce strategy, get in touch.

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