Michelle Thomas & Rob Grimsey, with contributions from Mrrinali Bhatia (San Francisco), Helen Fleming (Leeds), Rhodri Hughes (London), Daniela Eberhardt (Stuttgart)
First the bad news
We’re not going to sugar coat this: almost anywhere you look in the world the job statistics don’t look good. All across the world countries are reporting steep declines in jobs. For instance in the UK the Office of National Statistics reports the biggest fall in vacancies since it began reporting in 2001 (see below).
Not a complete picture
But a single graph is just one side of the story; albeit an eye-catching one. Whilst there is no doubt the market for technology jobs is much more difficult, you should remember two very key things. Firstly, the job market still very much exists, indeed there has never been more demand for technology than now.
The world’s organisations are built on technology, and all the research points to the Covid-19 crisis exaggerating this trend.
And secondly, whilst the graphs do show big falls, much of this is the ‘knee jerk’ reaction to uncertainty, CEOs are understandably thinking ‘We don’t know the future, so let’s put everything on hold’. Over time, often quite quickly, organisations will think beyond this, and start to turn their minds to planning, to using the current situation to gain market share and ultimately to investment. In technology.
In a nutshell: good technology people, with a proactive plan for finding a new role, are rarely out of a job for too long.
What sectors are hiring?
OK, so there are the obvious ones: governments are investing significantly, and this is finding its way into job growth in that sector. Healthcare and food retailing and are also steady or growth sectors. Again, for obvious reasons. Utilities, whilst not necessary growing, remains steady - everyone still needs water and energy, even in this upturned world.
Perhaps less obvious, banking seems to have held up quite strongly. Many financial institutions have learnt from the big hit they took in 2008 and have remained fairly robust during this current crisis. Some investment banks are taking advantage of the volatile market. Our consultants in London, New York and Frankfurt report roles being created. We suspect the same would apply to other financial centres too. Many banks entered this crisis looking to change their business models, so we may see a mix of job growth in one area and job cuts in others over time. We’ll update this posting when we see more.
Ecommerce seems to be holding up well too. Of course food retailing features here, but also other areas of eCommerce seem to also be doing OK, especially ones targeted at a younger generation most familiar with online.
Technology companies are also strengthening themselves. The massive growth in remote working and the use communications tools like Microsoft Teams and Zoom, not to mention demand for online services like Netflix has meant tech companies providing infrastructure or communications services have a healthy demand. The crisis has also made organisations rethink their approach to technology. Technology consultancies tell us their order book is growing; companies are coming to them for advice about how to adjust their infrastructure for this ‘new normal’, many are using this to accelerate their digital projects.
There are also some elements of the media and entertainment that remain strong. Those that entered into the crisis with a strong online model seemed to have remained strong. For instance Disney’s launch of Disney+ was a major stroke of good fortune, much needed as their other business – leisure parks – are clearly adversely affected.
Job roles in demand
Right now the roles most in demand reflect the rapid change in working patterns that has occurred across the world. Remote working has created a growth in the need for many of the ‘traditional’ tech skills, like infrastructure, comms, help desk, hands on project management.
Companies are also reporting a significant spike in cyber-attacks, building on an already existing trend of heightened concern for data privacy. We are already seeing a growth in these areas, and we’d expect that to continue.
So far the strength of demand has been routed in people who are relatively close to the ‘nuts and bolts’ of technology. But over time (and by that we mean weeks, or a short number of months, not years) organisations will begin to return to turn to their strategic priorities. For some it will be the same priorities as they had pre-crisis. For others, in fact most, there will be new priorities, and for a some there will be a realization they need to completely change their strategy and business model.
Whatever way organisations go, we expect to see job growth to be in areas beyond nuts and bolts, especially around data analytics and software development, both of which experienced high demand prior to the crisis.
Types of organisations
Whilst sector clearly plays a role in how the crisis might affect a company, the are actually other factors too. For instance companies in a badly affected sectors that are well-funded and have a clear and bold strategy to use this crisis to grow market share, may be looking to recruit as well.
The challenge for many organisations will be funding. Do they have deep enough pockets, or good enough connections with their financiers to see them through. Private companies, with cash, may fair particularly well here.
Where is it all heading?
If you look at the graph earlier on in this article, you may look at the big dip in jobs during the 2008 crisis and see the very slow return to job growth. The question on many people’s minds is; what path will this crisis follow? Optimists say this current crisis is fundamentally different from the previous one. In 2008 there was a structural problem with our global economy that needed to be fixed. Today, there’s nothing structural that’s wrong, it’s just we’ve been hit by the equivalent of a meteor from nowhere, and as soon as we work out how to step around that, we’ll get back to normal. Pessimists say that it may take years to work out how to step around it; that the meteor is in fact a permanent feature of the structure of our economies.
Only time will tell. But when people look back on this crisis it’s our belief that whilst Covid-19 will be a significant factor in our history, more significant for our global economy will be the growth and evolution of technology, from cloud to automation to AI and data.
What’s your view? Are you seeing certain sectors growing? Let us know…
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