Many economists believed that the job market would recover quickly after the global recession of 2008–2009, as it has in past crises. However, the nature of the financial crisis and significant structural problems in the banking industry meant that the labour market’s recovery took far longer than many anticipated—nearly a decade.
But as of right now, the industry is finally heating up. The low unemployment rate is driving businesses to raise compensation for workers for the first time since the recession in order to attract them and fend off competition from other businesses. Particularly in the technology industry, there is a significant demand for workers with the proper qualities and skills. Anyone with knowledge of data science, AI, or cloud management may expect to succeed in every way.
Talent Competition at Tech Giants
The largest tech companies in the world are currently competing with one another to entice the top people to the sector. For those with data and cloud expertise, some of the top businesses in the sector, including Amazon and Oracle, are offering salaries earning between $300,000 and $1 million a year, which is nearly double what was on offer in the sector five years ago. Additionally, in particular metro regions close to business headquarters, such as San Francisco, Portland, and Seattle – all of which are major global tech hubs – the competition for hiring these engineer and specialists is much fiercer.
Although some of the top tech organisations can afford to pay exorbitant rates, there is a rising trend towards hiring qualified individuals as and when they are required rather than paying high salaries. More and more businesses are beginning to understand that they don’t need to employ someone full-time in order to get the benefits from them; instead, they may use their talents “on demand” as needed and then allow them to sell their skills to other businesses when not in use.
It shouldn’t be surprising that we are seeing this kind of labour market innovation given how high wages currently are. Businesses would much prefer pay a fee when they do need a person’s specialised abilities and then save money the rest of the time than have to pay them up to a million dollars a year.
The Market for Freelancers is Competitive
The situation for mid-sized and small businesses may appear dire, yet changes in the labour market haven’t been wholly unfavourable. Indeed, many companies are discovering that they may get excellent rates even for tasks that would often cost a lot of money thanks to the expansion of the gig and freelancing economies. Platforms, like Field Engineer, for example, connect employers with freelancers, enabling businesses to choose from a pool of individuals to find the right fit.
The beautiful thing about this digital labour market is that it forces the market to equilibrate: prices drop as a result of freelancers being motivated to undercut one another for work. Additionally, businesses only have to pay for the labour they require, and the freelancer is free to continue living their life as they like without having to deal with the administrative and legal hassles of full-time employment.
Don’t compete with big tech for talent by following their tactics.
It’s safe to say that you will likely fail if you choose to recruit talent the same way big tech does, which is by offering enormous pay. Facebook pays $117,000 on average in salary. It exceeds $120,000 at Apple, and these sums do not reflect bonuses. Salaries would be closer to $250,000 if they did.
It rapidly becomes obvious that the issue of intense competition in the IT sector won’t go away when you realise that the internet of things, artificial intelligence, and the cloud are set to create more than 4.5 million new employment over the next five years. You must pick a different strategy to compete.
Nowadays, smart businesses understand that they can only compete with big tech by utilising a variety of diverse tactics. Offering flexible scheduling and a “hassle-free” atmosphere, where employees are not required to react to emails at all times, seems to be very popular. The on-demand worker platform offered by Field Engineer, which enables businesses to engage specific specialised contractors only as needed, much like they would an accountant, is the most significant advance, though. In what is quickly turning into a challenging labour market for employers, hiring in this way aids in cost containment and helps a company remain competitive.
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