October I.T. & Digital Market Update

Oct 27, 2021

WHAT'S BEEN HAPPENING?


Regional roundup


In Auckland, despite the current Covid outbreak and Level 4 and Level 3 lockdowns, the market is bustling, and we have seen a significant upsurge in work, with a dramatic increase in roles.


Burnout seems to be high on everyone's agenda in Auckland, with employers taking steps to ensure their staff are looked after during lockdown and while they are dealing with a high-intensity work schedule whilst working from home and dealing with family commitments.

The Wellington team has noted similar trends, with both government and private sectors still busy with projects, no slowdown during the lockdown, and clients continuing to onboard new starters.


Across the country, the market remains competitive, with candidate demand extremely high. Rates and salary expectations across our candidate pool are higher, and our teams see candidates presented with multiple offers and counter-offers.


Permanent is strong, with the demand for tech and digital talent at what feels like an all-time high. We have more people wanting to enter the contract market, with clients more than happy to wait four weeks for the right talent considering the current candidate shortages. Clients struggle to fill fixed term roles as they don't offer the security of pay that permanent or contract roles do.


With so much demand for talent, internal recruitment teams are still heavily reliant on the support of specialist technical and digital recruitment consultancies to work alongside them in identifying talent, and clients are also hiring their own internal recruiters to assist with hard to fill roles.



We see many recruitment agencies and employers alike pushing increasing generous referral schemes into the market to attract candidates.

A need for speed to secure top talent

When competition for specialised skills is so high, clients increasingly need to adapt their recruitment practices to ensure they are in the game, as most candidates actively looking for work are considering multiple opportunities.

Businesses that are still pursuing lengthy recruitment processes and moving too slowly find that shortlists evaporate with candidates securing roles with other companies before the first interviews, or during the process.


Some businesses have streamlined their recruitment processes to ensure they can offer key talent roles in a week or less, and we are seeing more clients moving to understand this demand and making sure they are putting processes in place to interview and make offers to candidates quickly.


As well as becoming quicker to move on candidates, some hiring managers have changed their processes to be less formal to be more attractive to candidates.


It is essential for hiring managers to keep close to their team and be conscious of how they are presenting themselves to candidates at interviews, as multiple offers to candidates are happening regularly, as well as counter-offers to keep candidates in their current roles.


We have been working to educate our clients on the importance of getting to candidates quickly. In reality, this means clients need to be more decisive - moving on contracting candidates within 24 hours and permanent people within 48 hours - not awaiting two weeks to shortlist.


Our team continuously focuses on a swift, efficient, and thorough process to secure top talent for your business without compromising quality or cultural fit. Our networks and relationships allow us to go direct to the talent without relying on job boards and effectively manage multi-offer or complex situations at speed.

A need for speed to secure top talent

When competition for specialised skills is so high, clients increasingly need to adapt their recruitment practices to ensure they are in the game, as most candidates actively looking for work are considering multiple opportunities.

We recommend that our clients establish a communication framework post-hire and during the notice period to maintain contact and engagement with the candidate. This could include being invited to teams video call drinks, joining the odd stand up where possible, and sending small lockdown gifts. The message here is to maintain the connection, so the excitement of securing the role carries through to them starting with the company.

Covid continues to bite so new solutions are required

The pain of border closure is deepening as the candidate pool in the country that is willing to move roles start to shrink steadily. We have numerous examples of candidates we have worked with who are now working for companies based in the US in full remote roles. Some crazy salaries are being offered, which makes it hard for local businesses to compete.


However, clients are becoming more open to engaging talent offshore, starting in their home country with a view to beginning the visa process when the borders open. We have several clients exploring offshore / outsource partners to bridge the skills gap while in-country resources are constrained.


Salaries scream skywards

Permanent salaries continue to rise to record levels due to the lack of talent available, and hourly contract rates are some of the highest in the market we have seen for a long time.


As demand continues to outstrip supply, we see Project Management, Business Analyst, Data, Engineering, Integration, Agile and Cloud related roles particularly affected with the market changing week to week. This is particularly problematic when clients are using old salary data to produce business cases.


As salary continues to trend upwards, counter-offers are way more aggressive in the current climate as employers offer significant increases to retain key staff. There needs to be more focus on meeting current market rates to retain staff rather than reacting to possible loss.


Candidates that were reserved about new opportunities last year are recognising the opportunity to earn more, and there seem to be more people considering new roles for more challenges or money.


Flexibility and work from home benefits are now the expected norm since Covid came to our shores, and we are seeing clients offering three days of work from home to entice people on top of high salary offers.


Although candidates are pushing for WFH, clients need to look closely at their culture when they have a large workforce doing this, ensuring collaboration is working well and employees have access to all the tools required to be successful. These aspects are important in ensuring good employee retention.


Contractor Chat

Many organisations have digital transformation and customer side programmes of work in flight, so the contract uplift is noticeable, and the market is booming.


On the flip side, contractor loyalty to seeing out a project has reduced significantly. We are seeing an increase in contractors resigning from roles mid-project, impacting organisations' ability to deliver projects on time.


Recruiters, internal recruitment teams, and hiring managers actively target contractors in contract and entice them away with higher rates and longer contract terms. This is not great for the contractor and their personal brand and also leaves many businesses in a difficult situation regarding delivery.


However, clients are willing to wait for candidates on four weeks notice in the contract market, meaning those looking to leave permanent employment to give contracting a go have more opportunities available.


Top talent requirements

Demand is high across the I.T. and technology industries in general, and we see shortages in all areas. However, we see increased demand for the following roles and skillsets:


  • Business Analysts – both contract and permanent


  • Project Management – indications that more new projects will soon be commencing


  • Product Manager/Owner


  • Data – across all levels


  • Cloud AWS/Azure capability


  • Architecture and Developers/Engineers across more modern tech stacks


We see a massive uplift in requirements for Cloud-based talent as vendors vie for these skillsets. This has been heightened with the emergence of some multinationals (Amazon and Google) trying to secure NZ-based remote staff.



Data, Security, Digital Customer Engagement, Cloud, CRM/ERP and Automation continue to be areas of high demand in the current market, coupled with BA, PM and Agile capability that has specific experience in these disciplines.

LOOKING AHEAD

The squeeze on talent will get tighter

Competition for candidates will remain until the borders open, and even likely beyond that. The likelihood of borders restrictions loosening in the next three months are slim, so the skills constraints will continue and deepen.



With limited MIQ bookings available, few kiwis are returning to NZ as they find it extremely difficult to get back here, so even the most enticing relocation packages are ineffective.

And locally, there are only so many times a candidate will change their job, so attracting talent from NZ businesses will also become more and more difficult.



Once the borders do open, immigration policy is likely to change will change, and new accreditation policy, increased minimum salaries and more stringent assessment of visa/residency application will be a reality.

Salary demands will bite


Candidate demands around salary will continue to increase, with many already seeking increases of at least 10% when looking to move to a new role. Increases in salaries and contract rates are great for candidates short term but may not be sustainable long-term for organisations.


To offset some of the salary demands, employers need to truly define their EVP and be more transparent about their business regarding strategy, projects, and career development. Position your company as the place to be for the next five years through sharing the journey and creating purpose. The decision to take a role needs to be bigger than just "more money."


Planning for Christmas


The next couple of months will be crucial for employers to secure talent before the Christmas break. Locking in talent this side of Christmas, bedding them in, and having them hit the ground running in the new year will be critical for all businesses in NZ.


In the project space


Government projects are still busy, particularly in the health sector, and we also see many large-scale infrastructure projects.

With major security breaches in several notable organisations over the last couple of months, we expect to see more focus here. Organisations are becoming more aware of the potential risk and implementing projects to improve systems and guard against future breaches.


We also see clients looking for candidates who have experience in newer technologies, which is likely to be a continuing trend in the project space.


International interest and focus on interns


We are likely to see more international companies targeting NZ talent to work for them remotely, as we have already seen Google and Amazon do in recent times.


These companies also target interns with lucrative programs, so New Zealand needs to up its game in this space. We expect to see larger graduate programmes being commenced, and we have seen international studies exploring whether internships should be paid or not – the resounding response was that they should.

A NOTE FROM OUR DIRECTORS



Some are hoping that borders opening up will solve our talent shortages and lead to expats returning. Post, the first lockdown in 2020, we didn't see this, and don’t expect any borders opening up and changing the current market.


This means recruiters and employers need to change the status quo, and we are seeing technology talent and recruitment transforming from a local economy to a global economy. This is led through the current pandemic, talent shortages, and improved technology and tools allowing distributed workforces to work effectively across the globe.


Employers need to think global to ensure they can remain competitive, whilst also not forgetting the very talent (graduates) that will be leading their companies in the future.


Investment into graduates needs to continue for all companies, and robust training and onboarding programmes will ensure you are future proofing your business with leaders of the future. Something that not enough companies are thinking about.


Despite the challenging environment that Covid is presenting in NZ, we have once again been blown away by the demand from our clients, and our teams across the country have been hectic with roles flooding in. As always, we continue to nurture our long-standing relationships and talent pools to ensure that despite the tight market, we are delivering the best recruitment solutions for our clients and candidates.


Stay safe out there!

Re-entering the Job Market: A Guide for Experienced IT and Technology Candidates in New Zealand

27 Mar, 2024
Entering the job market after many years can be a daunting task, especially in the fast-paced world of IT and Technology. With advancements happening at breakneck speed, it is understandable to feel overwhelmed when suddenly thrown into starting your job search journey anew. However, there are simple steps you can take to get you started, ease the transition, and help you in landing your new dream job. At Recruit I.T., we've seen many experienced candidates successfully navigate this path, and we're here to share some valuable advice with you. 1. Revamp Your CV Your CV is your ticket to securing interviews, so it is crucial to ensure it’s up-to-date and tailored to the roles you are applying for. If yours is still in typewritten format and doesn’t include what you’ve been up to for the last 10 years, now is the time to get it updated. Ensure it includes your most recent and relevant roles, delete your high school work experience, and highlight your relevant experience, skills, and achievements prominently, focusing on how they align with the requirements of the positions you're targeting. If you are unsure where to start, collaborating with a specialised recruiter like Recruit I.T. can provide valuable insights and guidance in crafting a compelling resume. 2. Leverage Your Network Don't underestimate the power of networking, especially in the tight-knit IT and Technology community in New Zealand. Reach out to former colleagues, mentors, clients, and industry connections to let them know you're actively seeking opportunities. Attend industry events, meetups, and conferences to expand your network further. Many job opportunities are filled through referrals, so make sure to stay connected and keep your network informed about your job search. 3. Explore Both General and Specialised Job Boards You may have found your first job via a newspaper classified, but times have changed! While general online job boards like Seek and Trade Me, as well as LinkedIn Jobs are a good starting point, consider exploring specialised job boards focused specifically on IT and Technology roles, and register with a relevant recruitment agency like Recruit I.T. as specialised platforms like our website job board cater to this niche market, offering a curated selection of job openings tailored to your expertise. By targeting your search on these platforms, you increase your chances of finding roles that align with your skills and career goals. 4. Prepare for Interviews Brush up on your interview skills to ensure you make a strong impression during the selection process. Research the company and the role thoroughly, familiarising yourself with STAR and behavioural-based interview techniques (there is lots of info online!), practising common interview questions, and preparing examples that highlight your abilities and experiences. Additionally, familiarise yourself with the latest industry trends and developments to demonstrate your awareness and relevance in the field. It also won’t hurt to review and brush up on your verbal and numerical reasoning skills – once again, there are lots of free resources online to help you practise these types of tests/exercises. 5. Update Your Skills The IT and Technology landscape evolves rapidly, with new technologies and methodologies emerging regularly. Whilst you’ve developed your abilities on the job, do take the time to update your skills and knowledge with formal certifications and training to remain competitive in the market. Consider enrolling in courses, attending workshops, or pursuing certifications relevant to your field. Not only does this demonstrate your commitment to growth, but it also enhances your attractiveness to potential employers. 6. Be Flexible and Open-Minded The job market can be unpredictable, so it's essential to remain flexible and open-minded throughout your job search. Be willing to consider different roles, industries, or a short-term contract opportunity that may not align precisely with your previous experience. Embrace new challenges and opportunities for growth, as they can lead to unexpected career advancements and personal fulfilment. 7. Seek Guidance from Experts Navigating the job market alone can be overwhelming, especially after being out of the game for some time. In many cases, if your position has been made redundant, your organisation may provide outplacement services to offer help with CV crafting, interview prep, job search, practise testing and in some instances will also provide free access to training platforms. Consider seeking guidance from experienced specialised recruiters like our Recruit I.T. consultants. Our team possesses in-depth knowledge of the IT and Technology industries, along with extensive networks and resources to support your job search journey. From resume optimisation to interview preparation, we can provide valuable assistance every step of the way. Utilise all the free and skilled help you can access! 8. Embrace Your Experience and Life Skills It's easy to feel apprehensive about re-entering the job market after a long tenure with a single company or a prolonged absence, but remember to embrace the wealth of experience and life skills you've accumulated over the years. Your past successes, whether in your career or personal life, have equipped you with valuable insights, problem-solving abilities, and resilience that will be sought-after and appreciated by employers. While you may not have a recent job application or job hunt history, your track-record speaks volumes about your capabilities and adaptability. Have confidence in your abilities, and don't underestimate the value you bring to the table. Highlight your accomplishments and transferable skills during interviews, showcasing how they make you an asset to any organisation. By owning your experience and life skills, you can instill trust and credibility in potential employers, setting yourself apart from other candidates in the competitive job market. Embarking on a job search journey after many years can be a challenging yet rewarding experience. By revamping your resume, leveraging your network, exploring job boards, preparing for interviews, updating your skills, remaining flexible, seeking guidance from experts, and remaining confident in your experience and skills, you can increase your chances of success in the competitive New Zealand job market. Remember, you are not alone in this journey, and with the right support and resources, you will find your next opportunity. Our team are always happy to shout the coffee and provide some expert friendly and constructive advice to help you get started on your job hunt, so reach out anytime!

March 2024 I.T. & Digital Market Update

By Kaleb Leeming • 11 Mar, 2024
Field at Present: From a Director’s Perspective Generally, we have seen a slow start to the year, continuing the trend we saw in the latter half of 2023. Despite feedback from the market that suggested a stronger bounce back, we have yet to see this in the market at present. There are pockets of activity - primarily back-fills to existing hires. As we gear towards the backend of the government’s 100-day plan, we should see the firming up of new projects and programmes, which will likely require capability to deliver these pieces of work. Unfortunately, we are still seeing organisations across a range of industries forced into making rounds of redundancies and other operational cuts or changes to help them operate more leanly during challenging times, and we’ve even seen this in the recruitment industry itself.

The True Cost of a Contractor

By Kaleb Leeming • 14 Feb, 2024
With the dynamic business landscape, many companies are embracing flexibility and adaptability as they navigate the ever-changing market. As someone who has worked in the technology and recruitment sector for a while, I’ve come across a common misconception that I’d like to address: the perception that contractors are significantly more expensive than permanent employees. I'd like to give light to the true cost of hiring a contractor and explore why it might be more budget-friendly than you think. Let’s start by acknowledging the elephant in the room – the hourly rate. It’s no secret that contractors often come with an hourly rate that seems higher than what you’d pay a permanent employee. But here’s the thing: an employee salary is just the tip of the iceberg. When you hire an employee, there’s a whole set of additional costs and overheads that can significantly impact on your bottom line. Let’s break them down: 1. ACC (Accident Compensation Corporation) When you employ a permanent employee, you’re obliged to contribute to ACC levies. These can add up and represent a substantial ongoing cost to your business. Contractors, on the other hand, handle their own ACC payments, freeing you from this financial burden. As I write this it sits at approx. $0.63 per $100 of payroll. Example being, a $100K Salary = $630 per annum. 2. Kiwisaver Permanent employees are entitled to Kiwisaver contributions from their employers. While it’s a great benefit for them, it’s an added cost for your business. Contractors manage their own retirement savings, releasing you from this expense. At the minimum contribution of 3% that is $3,000 based on a salary of $100,000 per annum. 3. Training and Development Investing in the professional growth of your employees is essential. However, it can be costly and time-consuming. Contractors typically bring their existing skills and experience to the table, minimising the need for extensive initial training and ongoing development programs. Various benchmarks have this between 1% - 5% of an individual’s salary. Based on a $100,000 per annum this could be between $1,000 - $5,000 per annum. 4. Fringe Benefit Tax Providing certain benefits to your employees can trigger fringe benefit tax liabilities. Contractors are not subject to this tax, which means you can offer perks without worrying about additional financial implications. 5. Benefits Permanent employees often receive benefits such as health insurance, paid annual leave, and more. While these are important for staff retention, they can substantially increase your personnel expenses. On the other hand, contractors manage their own benefits and extras, giving you more predictability in your budget. 6. Insurance A business is responsible for looking after professional indemnity and public liability insurance which cover their permanent employees. On the flip side, contractors typically have their own insurance coverage, reducing your insurance-related costs. 7. Overheads Beyond the salary, permanent employees come with a host of overheads like office space, equipment, and administrative support. Contractors usually operate independently, sparing you from these additional expenses. 8. Productivity It is not as simple as multiplying a contractor’s rate by the number of hours in a week, and then extrapolating that out for the year. They only get paid for the hours they work, which doesn’t include any annual leave, sick leave, or public holidays. You only pay them based on what the hours they actually worked. So, what’s the bottom line? Hiring contractors can be a cost-effective choice when you consider the bigger picture. While the hourly rate may seem higher, it’s essential to factor in the myriad of savings associated with not having to manage all the costs and overheads that come with permanent employees. Don’t get me wrong – permanent employees are valuable assets to any organisation. They bring stability, commitment, IP retention, and a sense of belonging to your team. But the key is understanding the differences between contractors and permanent employees and leveraging them to your advantage. Think of hiring contractors as a strategic move that provides the flexibility to scale your workforce up or down as needed, without long-term financial commitments. It’s not about one being better than the other; it’s about making informed choices that align with your business objectives. So, the next time you consider bringing in a contractor, remember the true cost isn’t just about the hourly rate- it’s about the holistic value they bring to your organisation.
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