Labor market trends in 2024

Each year the labor market experiences changes, especially in the IT sector. In this article, we will look at three major trends that will affect the labor market in 2024.

1. Workforce shortage

As of 2024, 98% of companies in the IT industry are experiencing a workforce shortage. 18% of them face a tangible need for employees in most areas of the company’s activities, and another 58% – only in some areas. However, despite difficulties with personnel hire, the average staffing level of IT departments remains quite high – around 91%. The cybersecurity and business operations sector are in the greatest need of qualified workforce. Also, in the industry, there is a shortage of specialists capable of working with hardware.

2. Staff turnover

In 2023, the turnover rate was 15%, and forecasts for 2024 are an additional increase of up to 16%. This is due to the active hunting for mid- and high-level professionals, as well as the mobility of entry-level specialists. For companies, this means importance of employee retention strategies and creating a proper company culture.

3. Salaries and loyalty programs

In conditions of workforce shortage, the main method of employee retention is still increasing wages – it is chosen by 95% of the companies. The average salary increase is about 11-12%, while almost a third (34%) of companies review employee remuneration more than once a year. However, in addition to the financial aspect, companies also actively use other methods to increase loyalty: health insurance programs, personal non-financial incentives, compensation for sports, rental housing, psychologist sessions, as well as flexible work schedules.

An analysis of the current labor market situation suggests that we are still in the conditions of a “job seeker’s market.” Companies lack staff and have to spend enormous resources on finding and retaining human resources. In addition, the situation for companies is aggravated by the fact that in some areas of the IT industry, a delay in development is tantamount to a loss of market share. That is why companies are increasingly moving away from the traditional search for developers, choosing more profitable hiring strategies.

Companies that intend to maintain and improve their positions in the market use:

  • Implementing AI to improve efficiency.
  • Using Low-code and No-code platforms.
  • Using temporary employees in the format of outsourcing or outstaffing.

These solutions let you maintain the pace and quality in completing any company tasks. And in constant turbulence conditions on the labor market, this requires using all available options and finding new opportunities.

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