December 1, 2015 – Toronto, ON – Employers in Canada’s information technology (IT) sector fought through a turbulent 2015 and emerged confident they will be growing their businesses in the coming year. However, findings of the sixth annual Hays Salary Guide reveal that a general sense of optimism masks looming staff retention and recruitment problems, a lack of succession planning and reputational issues, which combined could ultimately spell big trouble for Canadian employers.
Conducted in October, the Hays 2016 Salary Guide highlights employer confidence, a look at business expectations versus results and a snapshot of hiring trends and challenges. Going into 2015, Hays found nearly three-quarters (71%) of IT respondents anticipated business growths during the year. While only half actually saw gains, 38 per cent increased staff levels during the year and eight per cent of employees saw salary increases of six per cent or more, which was double the national, cross-sector average. When asked how they feel about the coming year, the majority (80%) expect the Canadian economy to strengthen or remain stable, two-thirds anticipate increased business activity and nearly half (45%) intend to boost their company’s headcount.
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It may have been a solid year for many of Canada’s IT employers but not everyone emerged unscathed. Hays found that salaries for 10 per cent of employees were frozen in 2015 and will remain that way next year. While IT employers have some of the country’s highest expectations for increased business activity, 11 per cent expect to make staff cuts in 2016. Though almost half of employers intend to hire staff in the coming year, 68 per cent of IT employers say the sector suffers from a moderate to extreme shortage of skilled workers.
“It’s fantastic to see that so many of the country’s IT employers found success in what was widely considered a dismal year for the economy,” said Rowan O’Grady, President, Hays Canada. “This level of optimism is further evidence of Canada’s world-class technology talent base, but there are cracks in that foundation that employers need to address. Recruitment grew more competitive in 2015 and candidates have become more selective about where they want to work. Now is not the time for IT employers, particularly those planning to hire, to rest on their laurels.”
Have IT employers kicked their problems down the road?
While the country’s IT employers plan to ride their momentum into 2016, many report that staff are under considerable pressure. Adding headcount is part of the plan for the coming year however, almost three-quarters (74%) of employers said they lack the resources to recruit. This is complicated by the fact that career progression is the number one employee expectation across Canada and nearly a third (29%) will leave a company that doesn’t support their goals.
In contrast, IT respondents acknowledged that employee advancement is a low priority for them even though they are largest group of Canadian employers (37%) who believe the skills shortage is due to a lack training. Given the competitiveness in Canada’s labour market, Hays asked if recent graduates or more junior candidates were a hiring option and 57 per cent said they’re not actively recruiting entry-level personnel.
While perceived skills shortages keep many of the country’s employers awake at night, for the first time in two years, the Hays Salary Guide revealed that company reputation and awareness now tops the list of recruitment burdens across all sectors. Employers said they believe fewer people pursue careers in their respective industries due to stereotypes and reputational matters and only they can resolve these issues for themselves.
“Training staff and supporting career development is no longer a nice-to-have perk. It’s a basic employee expectation and considering how fast the tech sector evolves, ignoring that fact can be very risky,” said O’Grady. “The challenges highlighted in this report are well-known to IT employers but they haven’t tackled them and they could be backing themselves into a hazardous corner.”
Additional 2016 Hays Salary Guide findings:
- Seventy-four per cent of Canada’s IT employers expect business growth in 2016; higher than any other sector (manufacturing: 64%, construction 51%, oil and gas 27%)
- Well more than half (68%) of Canada’s IT employers believe Canada suffers from a moderate to extreme skills shortage
- More than three-quarters (77%) of Canadian employers have moderate to extreme difficulty recruiting talent
- Sixty-one percent of Canadian employers have moderate to extreme difficulty retaining staff
- Twenty-nine per cent of employees will leave an organization that doesn’t support their career development goals. While half of employers recognize the priority employees place on career development, they choose instead to focus on salary, company culture and benefit packages
- 42 per cent of employers feel that a skills shortage has resulted in productivity issues
- Fewer than half of Canadian employers (49%) find social media to be an effective tool for recruiting staff
About Hays Canada:
Hays Specialist Recruitment Canada is a wholly owned subsidiary of Hays plc, which has been at the forefront of the global recruitment industry for over thirty-five years. With annual revenues of over £2.1 billion, Hays Specialist Recruitment is the largest specialist recruitment consultancy in the world.
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