You can have a terrific corporate culture, focus on challenging projects, and provide the means for your employees to work with great technology. But if you’re not paying IT pros what they can find elsewhere, don’t expect job candidates to accept your offer, and don’t expect the talent you do have to stick around long.
That’s the conclusion that is drawn from the results of the 2016 Talent Acquisition & Retention Survey for the Information Technology Sector recently released by Harris Allied, an executive search firm in New York. The survey of 151 IT executives found that while offering an excellent compensation and benefits package topped the list of strategies companies use to attract IT talent, having a corporate culture that provides an attractive work/life balance edged out competitive compensation to top the list of strategies companies use to retain IT talent.
The former strategy is apparently on track: The survey found that better compensation offered elsewhere was far and away the top reason candidates cited for declining a job offer. But the latter strategy apparently needs to be tweaked: The respondents said the No. 1 reason people leave is that they’re not being paid enough.
“One of the things that was interesting to us was that when candidates decline offers, and the main reason for attrition, still falls back on compensation,” said Kathy Harris, managing director of Harris Allied, in an interview. “People stay in a role, or leave a role and go onto something new, largely for reasons having to do with compensation.”
One finding that struck me was that only 8.6 percent of the respondents said they’re able to recruit top talent from within their own organizations, but it appears they have only themselves to blame: According to the survey, managers do recognize that one of the key reasons they’re having a hard time retaining top talent is their own failure to provide adequate professional growth opportunities. I asked Harris if she had any sense of what the reason for that disconnect is, and she said her guess is that there’s been a lack of formal professional development opportunities ever since the downturn in 2008, when companies were cutting costs and streamlining their operations.
“So employees lack the resources for professional development that they otherwise would have had,” Harris said. “Hiring managers are just trying to keep all the plates spinning at once. If companies want to look for ways to retain their talent, this is truly an opportunity.”
I interviewed Harris last year when the 2014 survey was released, and I asked her at the time to predict how the 2015 survey results would differ from the results of the 2014 survey. She offered three predictions, and they turned out, by and large, to be quite accurate.
First, she predicted that there would be even more aggressive recruiting in 2015, as firms look to their competitors and different industries as a source for talent. I asked her if they ended up doing that to the degree she expected, and Harris said they did. “It’s a very competitive market,” she said, “and we’re seeing a lot of candidates with multiple offers.”
Second, Harris predicted that there would be a trend toward more aggressive compensation packages for top talent, including an increase in guaranteed cash bonuses and more frequent sign-on bonuses. On that one, Harris said they haven’t been seeing the guaranteed bonuses so much, but the total compensation packages, to include base pay, bonus, and equity, have indeed been very aggressive.
Third, Harris predicted that due to the tight labor market and increased employee attrition, there would be more consulting and contract-to-hire opportunities in 2015, as employers cast wider nets to find top talent. Asked how that one panned out, Harris said more companies are, in fact, open to contract-to-hire than they have been in the past.
I asked Harris if there was anything that came out of the 2015 survey that she never would have predicted. She said companies are getting much better at articulating their own narrative relating to the value proposition they offer.
“Employees want to work for companies that have a story to tell in terms of future growth,” Harris said, “and more companies are capturing and conveying to employees their strategies for growth within their industries.”
Other key findings from the 2015 survey:
A contributing writer on IT management and career topics with IT Business Edge since 2009, Don Tennant began his technology journalism career in 1990 in Hong Kong, where he served as editor of the Hong Kong edition of Computerworld. After returning to the U.S. in 2000, he became Editor in Chief of the U.S. edition of Computerworld, and later assumed the editorial directorship of Computerworld and InfoWorld. Don was presented with the 2007 Timothy White Award for Editorial Integrity by American Business Media, and he is a recipient of the Jesse H. Neal National Business Journalism Award for editorial excellence in news coverage. Follow him on Twitter @dontennant.