The 'Worst is Over'? Tech Employment Growth Strong in 2021

Tech employment last year exceeded 2020 by 155,300 new jobs, while the three-month job creation average continues trending upward.

That’s according to Janco Associates. For 17 months in a row, there has been an increase in tech employment. The hiring of IT professionals is robust. This is true across all industries.

“In the last quarter of 2021, CIOs continued to expand IT staffs,” said Janco CEO Victor Janulaitis. “However, not as many candidates were hired due to the lack of qualified IT pros. From data that we have reviewed, shutdowns resulted in fewer computer science candidates graduating from universities and trade schools. Those in the pipeline for those degrees is reduced as well.”

Inflation, COVID-19 Variants Won’t Stop Tech Employment Growth

Even with inflation and uncertainties caused by new COVID-19 variants, CIOs plan to hire more staff, and expand technologies to address blockchain processing and security applications, he said.

Janco’s Victor Janulaitis

“The worst is over,” Janulatis said. “And now the focus will be on retaining existing staff and adding new capabilities to the IT infrastructure. The inflation threat is real and salaries for new hires need to be higher — we estimate 6%-10%. At the same time, salaries for existing staff are not keeping up with inflation. And salary pay range compression is occurring. Those factors, along with the reluctance to get back in the office, are driving attrition rates up in many IT functions.“

In 2021, actual IT salaries for existing IT staff and middle managers increased by just over 2% (not keeping up with inflation) while new hires are paid 5%-6% more than existing staff, he said. That salary disparity is a driver of employee dissatisfaction and an increase in attrition rates.

Strong Hiring Anticipated

Tech employment and hiring opportunities continue to expand, according to analysis by CompTIA. December’s technology employment gains bucked the generally underwhelming national employment trend.

The nation’s employers stepped up their search for additional tech workers in December, with an estimated 332,564 job postings for open positions. That’s 22,500 more than in November and the highest monthly total since March 2020.

CompTIA’s Tim Herbert

“This undoubtedly sounds like a broken record, but there is no escaping the influence the pandemic continues to exert over hiring decisions and business investments,” said Tim Herbert, CompTIA‘s executive vice president for research and market intelligence. “Adaptation remains a driving force for organizations expanding their tech workforces in areas such as cloud infrastructure, remote support, data science and cybersecurity.”

Among industries, professional scientific and technical services (53,603), finance and insurance (35,039), manufacturing (26,629) and information (17,755) listed the largest numbers of open positions last month.

Within the tech sector, December’s new hiring was led by growth in the IT services and custom software development occupation category (+10,200). Employment in the telecommunications, and computer and electronic products manufacturing categories declined.