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Market Update: 3 Changes Tech Businesses Have Faced in 2021 so Far

Posted on 7/10/2021
by Nick Boulton

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Client Server Director Nick Boulton gives a quick update on changes, and what businesses need to be aware when it comes to hiring in this constant changing tech market.  


Can you believe there are only three months left in 2021 – where has this year gone? So much has happened within such a short time frame.

The COVID-19 pandemic and its economic disruption have dominated our every fibre in the past year, including the IT sector. This year, although the effects of the pandemic remain, the big news stories in the tech industry are overwhelmingly positive, as innovation increases and everyone is in a race to keep pace.

Happily, I can say that the last six months have been some of the best in recruitment. Our decision to keep all our staff in the pandemic in the hope that they would repay that loyalty was risky, but is paying off. Our leadership team has gone from strength to strength, and the rest of the company is enthusiastic and motivated to succeed. We have an incredible atmosphere in the business, our trainee schemes are back on track, and we are eager to hire. We can now grow, capitalise, and face any other challenges that might come our way. In the next 12-24 months, we plan to grow our business significantly, and our leaders are extremely capable of executing these plans.

Here is a quick market update on changes, challenges, and common issues we have observed businesses face so far this year:

Salaries

  • There has been a steady increase in salaries so far in 2021. 15%-20% increase are the norm when a candidate is looking for a new role, with 25% + also commonplace.
  • Surprisingly, remote work has had little impact on salary expectations. Without exception, candidates expect and achieve the same salary level, regardless of how flexible the role can be.
  • This has created a challenge for companies outside London who are not used to competing with London companies in terms of hiring. London businesses that can offer flexibility are now capitalising on a candidate pool they could never tap into before. Salaries in tech hubs such as Bristol, Leeds, Liverpool, Manchester, and Cambridge have also increased due to the increase in incomes in London. In the long run, this will have a positive socio-economic impact for areas that would not have had residents with the disposable income they now have.
  • Rough salary ranges for developers we have seen this year:
    • Graduate - £40-45K for in and around London (perhaps £35K+ if a little further afield).
    • Mid-level - £55-85K 3-5yr candidates are by far the most popular in the market and have had the biggest bump in salary.
    • Senior - £80K-£125K six figures are still not frequent for an individual contributor. But in some of the more in-demand technologies, they are now more regular.

In demand technologies / skills shortages

  • In summary, all modern technologies are popular, and talented candidates are in short supply and high demand – it’s not unusual for them to get 10+ interviews and 3+ offers – this is a CANDIDATE market!
  • Currently, the most in-demand technologies are:
    • Python – strong back-end engineers, especially mid to senior level, are hard to find (the market is webby/several businesses use Python, but not to build core systems).
    • The candidate pool for SRE / DevOps is vast, but most candidates are not technical enough (lack of programming, Cloud, Kubernetes/Docker experience, etc.) for clients seeking to hire in that space.
    • Data Engineering can mean different things for different companies. But a balance between software development (like Python) and data expertise (maths, use of Kafka, Spark, or a similar tool) is in demand and hard to find.
    • Cyber Security – With even more of our lives moving to digital, the need for quality security engineers is on the rise.

Effects of Brexit / hiring from outside the UK

  • Today, more tech hubs are growing in Europe, attracting UK staff, often getting them to return to their native countries.
  • Larger tech companies in Europe now also pay equivalent salaries to many countries. For example, well-known banks in Poland are currently recruiting engineers at 80% of London's pay! This trend will continue, which will further reduce the tech talent available to work in the UK.
  • We have seen some clients try to use this by hiring remote engineers from Europe, which is cost-effective (in salary) but challenging in terms of UK tax/employment laws and business culture.

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