29 Jan Persistent Talent Shortage May Hinder Technology Company Hiring
For Immediate Release
Chattanooga Technology Council
Persistent Talent Shortage May Hinder Technology Company Hiring
Survey of 1,500-plus executives offers national, regional views on business conditions, investment plans and policy concerns
Jan. 29, 2015 (Chattanooga, Tenn.) – Technology companies across the country say they intend to hire new staff over the next 12 months, but those plans may be sidetracked by a continuing shortage of qualified tech talent, according to a new survey released today by the Technology Councils of North America (TECNA) and the Chattanooga Technology Council.
The third annual National Survey of Technology, Policy and Strategic Issues survey reveals that the perception of the quality and quantity of tech talent has worsened. A net 74 percent of technology executives say there is a shortage. Nearly a third categorizes the shortage as significant.
By comparison, 69 percent of executives in a 2013 survey agreed there is a shortage, with 25 percent calling the shortage significant.
“Like many communities, we understand the challenges of growing and retaining our talent pool, “says Ronna-Renee Jackson, Executive Director of Chattanooga Technology Council.
“Chattanooga area business, community and education leaders are taking steps now that will lead us forward, building on the momentum of successful initiatives such as our high school- STEM School Chattanooga, Chattanooga Girls Leadership Academy- the first single-gender STEM focused charter school, and the launching of technology-oriented after-school programs such as TechTown.”
This perception of a tech talent shortage comes at a time when 63 percent of executives say their companies intend to hire new staff over the next 12 months. Three-quarters of small firms (10-99 employees) and two-thirds of medium sized companies (100-499 employees) expect to add staff over the next year. Smaller percentages of micro firms (57 percent) and large companies (52 percent) plan to do so, as well.
“The skills shortage issue is one that affects technology companies from coast to coast and border to border,” said Steven G. Zylstra, TECNA chairman. “We’re in the midst of a great phase of ingenuity and innovation, and companies are poised to do even more, but the shortage of skilled workers poses a serious threat to their ability to reach their goals.”
“TECNA members such as Chattanooga Technology Council are committed to doing all they can to ensure there is a sustainable pipeline of skilled new entrants into the nation’s technology workforce,” said Bob Moore, CAE, TECNA executive director.
Other Key National Findings
Business sentiment: The survey reveals positive momentum in executives’ assessment of business conditions and the economy. Confidence in the U.S. economy made the biggest jump year over year, climbing from 56.4 (on a 100-point scale) in 2013 to 63.2 in 2014. Executives are most confident in their own companies (72.2), followed by the tech sector overall (71.9). At 54.6, the global economy had the lowest mark.
The six-month outlook is generally favorable, as well, with 65 percent of firms expecting improvement in their own companies; 47 percent in the tech sector; and 41 percent in the U.S. economy. Enterprise software firms, IT services firms and digital, media, apps and data firms have the highest expectation for improvement in business over the next six months.
Increased investments: Beyond hiring new workers, a significant number of companies have other business investment plans for the next six months. For example, 62 percent say they’ll invest in new product and business lines. Just over half plan more spending on advertising and marketing activities.
Growth Inhibitors: Concerns about the impact of the talent shortage registered the biggest jump when executives were asked about factors that could inhibit growth. But levels of concern about other issues either declined (general lack of confidence, government regulation) or held steady (lower margins, downward pressures on pricing, unexpected shock) from the 2013 survey.
Impact of Government: Executives gave low to middling marks when asked to rate how well government represents the interests of the technology sector. At the federal level, 45 percent said poorly or very poorly and 41 percent said “just okay.” Both figures are identical to the 2013 survey. At the state and local levels, the 2014 ratings were virtually unchanged from a year ago: 24 percent of executives said poorly or very poorly and 39 percent just okay.
Policy Priorities: More government support for STEM (science, technology, engineering and math) education at both the K-12 and secondary education levels should be the top policy priority in 2015, according to executives surveyed by TECNA and Chattanooga Technology Council. Following closely behind STEM education as an area for policy action is taxation and regulatory reform, cited by 42 percent of respondents.
Regional Breakdown Specific to Chattanooga and Nashville Technology Councils combined responses
- Business sentiment among respondents is strong, with 70.2 percent of executives expressing a positive outlook about their company’s future prospects.
- Nearly seven in 10 Chattanooga and Nashville companies plan to increase staffing levels among their technical positions over the next six months. Increases in staffing of non-technical positions are planned by 56% of firms.
- 54% of Chattanooga and Nashville respondents express concern over a talent shortage, labor prices and employee churn.
- 20% of survey respondents from Chattanooga and Nashville executives said state and local governments do a poor job of representing the interests of the tech sector while 34% say representation is “OK” and 46% feel that the interest of the Tech Sector are well represented.
The 2014 National Survey of Technology, Policy and Strategic Issues is the result of an October 2014 online survey of 1,561 senior (C-level) U.S. IT and business executives belonging to Chattanooga Technology Council and other regional technology associations affiliated with TECNA. The survey was conducted in conjunction with CompTIA, the IT industry association. The complete report is available at http://www.technologycouncils.org. The custom report focused on findings across Chattanooga and Nashville can be found on the Chattanooga Technology Council’s website: www.chattanoogatechnologycouncil.org
About Chattanooga Technology Council
Chattanooga Technology Council’s mission is to connect the Chattanooga Technology community to help drive economic growth across the region. They invest in the workforce pipeline and promote Chattanooga as a top technology hub. Current membership spans 10 different industry sectors with over 100 companies of all sizes represented. Membership is open to all.
The Technology Councils of North America (TECNA) represents 50+ IT and Technology trade organizations who, in turn, represent more than 22,000 technology-related companies in North America. TECNA serves its members and the industry through its strong peer-to-peer network and its regional initiatives to raise the visibility and viability of the technology industry. For more information, visit http://www.technologycouncils.org.