Tech Departments are Facing Difficulties in Accomplishing More with Fewer Resources due to Hiring Freezes and Job Cuts
The COVID-19 pandemic has had a profound impact on the tech industry, resulting in widespread economic disruption. As businesses struggle to stay afloat, many have been forced to implement hiring freezes and cut costs, leading to smaller tech teams and overworked employees. Pluralsight‘s recent State of Upskilling report indicates that nearly half of all tech workers are feeling the effects of these changes, with increased workloads and additional responsibilities.
To ease the pressure on tech teams, the report recommends that businesses invest in upskilling their employees. This approach not only helps to fill talent gaps but also enables organizations to meet strategic business goals. According to the survey conducted by Pluralsight, companies are increasingly turning to internal upskilling to achieve these objectives. The report shows that 47% of tech workers have taken on additional responsibilities outside of their regular roles due to workforce reductions.
As a result of hiring freezes and layoffs, tech managers and leaders have had to identify cost efficiencies, which has put a significant burden on their teams. Pluralsight’s report found that 65% of tech managers surveyed were asked to identify cost efficiencies, while 67% of technology leaders agreed that their teams had taken on more responsibility due to the pandemic’s impact on the workforce. Despite these challenges, 85% of respondents indicated that their organization was planning or actively engaged in a digital transformation project in 2023, underscoring the need to invest in upskilling.
One of the key benefits of upskilling is its potential cost-effectiveness compared to hiring external talent. While the average cost per hire was $4,700 in 2022, Pluralsight’s report found that 55% of tech managers and 47% of HR directors spent no more than $5,000 per employee per year on upskilling and reskilling. This approach can help organizations save money while ensuring their employees remain proficient in the latest technologies and stay competitive in the global market.
To this end, the report found that 97% of HR and Learning and Development directors surveyed were prioritizing upskilling existing staff over hiring for open roles in 2023. Additionally, 72% of tech leaders planned to increase their investment in tech skill development in 2023 to equip their employees with the necessary tools to manage new and unfamiliar responsibilities.
The Chief Product Officer at Pluralsight, Gary Eimerman, stressed that businesses recognized the importance of balancing investment in skills with other areas that returned more immediate ROI, such as sales, and prioritizing profits. He noted that keeping employees up to date with the latest technologies allowed them to innovate and maintain their competitive edge in the global market.
However, Pluralsight’s report also highlighted that organizations may not be effectively mapping employee upskilling to business objectives. While cybersecurity, cloud, and data science were identified as the most critical disciplines for driving business value in 2023, only a small percentage of tech workers reported feeling completely confident in these areas.
Finally, the report identified several organizational hurdles that hindered employee learning and development. HR and L&D leaders cited budget constraints, a lack of employee engagement, and a lack of visibility into employee progress as significant challenges. Meanwhile, employees themselves reported a lack of time, a lack of support from their managers, and inadequate access to the necessary resources.