When there is a 4.5 million-person gap between supply and demand in tech jobs, and when an estimated 38% of tech workers have been stagnant in their positions for the past three years, it becomes easy to see why having the right recruitment infrastructure has become a critical competitive advantage for companies.
“The pandemic actually proved the importance of recruiting the right talent, and also the importance of recruitment infrastructure,” said Vijay Swaminathan, co-founder and CEO of Draup, an AI-driven decision-making platform for corporate leaders in sales and talent. “What the big tech companies pay for recruitment infrastructure is significantly different from what traditional enterprises would pay, right from the number of recruiters they have,” Swaminathan continued.
He used the example of Apple, which planning a new, $1 billion campus in North Carolina’s Research Triangle Park that would create 3,000 new jobs. “The first thing that they're working on is to get all the top recruiters from enterprises and assemble a very powerful team,” Swaminathan said. Every company, whether it’s in retail or manufacturing, competes for digital-tech talent, or near-tech talent. In fact, in the next two to three years, the gap between supply and demand in tech jobs is expected to skyrocket to 8.2 million, said Swaminathan, who gave a presentation titled “The Phenomenon of Incongruence in Candidate Expectations” at From Day One's September virtual conference on new ideas and tactics for successful diversity recruiting.
Draup believes that there are multiple instances in the recruitment process, from the understanding of the candidate's expectations to the post-interview process, where big data can come in handy. This is particularly relevant when it comes to hiring technical talent and the understanding of the components of the job offer, he said. There is a significant difference between how big tech companies approach software-development talent, versus more traditional enterprises in which technology is not the primary product or service. “I am consistently seeing that enterprises are underestimating what it costs to bring software talent into the enterprise,” Swaminathan said.
When companies make offers to software or technology talent, they need to be aware of the competitive rates for the multiple components of the offer: the median base pay, plus an annual bonus, a signing bonus, and stock options. “Understanding these components of the offer, with respect to where the offer stands, is really important,” Swaminathan said. “Otherwise, you would put your recruiters at a disadvantage if the market is at a different level and you are trying to get similar talent at a lower-than-expected budget.”
Another important component for recruiters to understand, according to Draup's research, is the strengths and weaknesses of peers–what are they known for, what do they struggle with? For example, Google is known for its algorithmic work, while Apple is known for its design and innovation across the board. “Similarly, it’s important to understand the big players in your market and at what rate they're ramping up,” Swaminathan said. He used the San Diego office of Apple as an example. In the last three years, its workforce grew by almost seven times, but if one considers the company’s administration and HR staff, this growth started earlier.
With the surge in distributed work triggered by Covid-19, geography has become a bigger consideration in hiring. “The pandemic has been a big boon for middle America,” said Swaminathan. “Draup has mapped more than 20,000 resumes in terms of updates in the last year to see how many people have made location changes.” Draup’s research confirmed the migration of tech talent from coastal hubs to places like Indianapolis, Nashville, Atlanta, Denver, and Salt Lake City. “This is very, very exciting for me personally, because in economic theory, when a movement like this happens, it is always a good sign because people around that ecosystem will interact with other folks,” he said, citing the example of Apple engineers moving from the West Coast to Columbus, Ga., where they mentored students potentially on their way into tech fields.
The prospective result of such migration: a bigger, organically grown ecosystem of talent. And unless you are doing very advanced algorithmic work, Swaminathan explained, the tools for developing software have improved so much that a much larger pool of workers can now be brought into tech development.
Editor's note: From Day One thanks our partner who sponsored this thought-leadership spotlight, Draup.
Angelica Frey is a writer and a translator based in Milan and Brooklyn.