Compensation, Work Lives and the Economy
A large majority of the tech professionals we surveyed expressed optimism about the growth of the profession. However, many tech professionals are dissatisfied with their experiences as candidates and employees. What’s more, our research found significant divergences between tech professional and HR professional sentiment, particularly in salary transparency and economic outlooks.
Our data examines those divergences and what’s causing job dissatisfaction among tech professionals. We’ll dig into results related to pay transparency, employee attrition rates, employee wellness and work-life balance, and gig and contract work prevalence (hiring freelancers and IT contractors adds additional nuance to these situations), along with outlooks on the economy and the job landscape. While we focus here on the discrepancies, it’s also important to note that tech professional sentiment doesn’t always differ from that of HR professionals; we’ve noted those situations in certain areas as well.
To arm you with actionable takeaways, we’ve assembled some core recruiting advice to help organizations navigate the challenges or discrepancies between tech professionals and employers highlighted by our data.
Recruiter Tips
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With several states enacting laws requiring pay transparency in job postings, and increasing expectations for pay transparency among tech professionals, it’s essential that you disclose accurate salary information early on in the process. Adding salary ranges to job postings is the most obvious avenue to do this, and there are also many other ways you can be proactive in being up-front with candidates on compensation. In addition to showing up as an employer who has a candidate-first mentality, salary ranges also help narrow application flows to more relevant candidates.
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Burnout has long been an issue affecting tech employees at all levels. Work-life balance for employees is critical (in fact, perceived lack of work-life balance is one of the top reasons Gen Zers will turn down a job offer), and for many tech professionals, it didn’t improve over the past year. To combat this, HR professionals and recruiters can highlight their organization’s communication boundaries, flexible work arrangements and vacation/PTO policies to demonstrate a suitable employee work-life balance commitment to candidates. In doing so, you can establish an instant bond with many tech professionals.
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Sixty percent of respondents said they will likely change employers in the next year. Many of those who aren’t actively seeking are potentially open to new roles, and canny recruiters are taking advantage of this. As a result, retention must remain a priority for employers. Keys to retention include the aforementioned work-life balance components, upskilling, mentoring, great company culture and clearer career paths. A company that’s established these benefits can also enjoy an uptick in employee referrals while reducing future recruiting costs.
To get a deeper look “under the hood” of tech professional sentiment, check out the data and research we put together around pay transparency, attrition rates, economic outlooks, current job market trends and more below.
Pay Transparency
Pay transparency is increasingly important to professionals across all industries. More than a quarter of the American workforce is legally entitled to salary transparency, with states including California, Nevada and New York passing related laws. Moreover, more than half of workers — including nearly two-thirds of Gen Z applicants — across the country increasingly expect employers to post salary ranges on job ads.
Although most of the tech professionals we surveyed said they applied to jobs that didn’t disclose pay ranges, the majority agreed that a lack of salary transparency negatively impacts their perception of a company. Seventy-five percent of tech professional respondents agreed that not showing the salary for a position makes them think it will be less competitive or lower than average. Roughly two-thirds of respondents are discouraged from applying to jobs that don’t disclose salary information.
of tech professionals agreed that not showing the salary for a position makes them think it will be less competitive or lower than average.
of respondents are discouraged from applying to jobs that don’t disclose salary information.
Despite how much salary transparency (or a lack thereof) shapes a tech professional’s perception of a company, there are surprising gaps between tech professionals and HR professionals on disclosing pay ranges. Nearly seven in 10 HR professionals indicated that their organization is confident they’re offering competitive salaries; however, only 44% of HR professional respondents said all of their job posts disclose salary information, and over half said only some job posts disclose pay ranges. Companies may need to adjust their position on salary transparency if they want to persuade top talent to apply.
For tech professionals, a company’s salary transparency is a key indicator of its commitment to pay equity. Sixty-three percent of tech professional respondents agreed that a lack of salary transparency is a signal that a company is not committed to pay equity.
of tech professional respondents agreed that a lack of salary transparency is a signal that a company is not committed to pay equity.
Over half of tech professionals said it is “very” or “extremely” important that their company conduct a pay equity analysis. However, nearly two-thirds of tech professional respondents said their company has not communicated a pay equity analysis to them. That’s despite the fact that eight in 10 HR professional respondents say their company conducted a pay equity analysis, and six in 10 say they’ve communicated a pay equity analysis.
Changing Employers, Attrition Rates and Times-to-Hire
One-third of tech professionals surveyed said they were actively searching for a job and even more respondents — 60% — said they will likely change employers within the next year. This represents an eight-point increase from 2022, when 52% of respondents said they were likely to look for a new job. As you might expect with the recent destigmatization of job-hopping among younger professionals, tech professionals between 25 and 34 years old as well as those with 10 years or less of experience drove both of these stats.
It’s impossible to pinpoint a single “why” behind these jumps (and previous years’ jumps). Factors such as changing mindsets from the pandemic, the prioritization of flexible work and fear of impending layoffs amid economic uncertainty likely all play a role. From both a hiring and retention perspective, it’s more important than ever for employers to prioritize strong candidate experiences.
Candidate experience is also top-of-mind for many of our HR professional respondents. Most of the HR professionals we surveyed indicated that their times-to-hire have been faster in 2023 than in 2022. While these time savings could be due to urgent needs and tech talent more willing to hop jobs (which aligns with our data showing 59% of HR respondents had an increased tech attrition rate compared to last year), improving candidate experience also likely plays a role.
How have your hiring timelines (time-to-hire) at your organization changed over the last year?
Work-Life Balance
Work-life balance plays a significant role in tech professionals’ willingness to seek new employment opportunities. Although the majority of millennials and nearly half of Gen Z professionals say their job is central to their sense of identity, there’s a strong desire to achieve a better work-life balance. In fact, more professionals are asking up-front in job interviews about how employers will protect their balance.
More than half of tech professional respondents said their work-life balance hasn’t improved since last year (compared to last year, when significantly more tech professionals indicated an improvement). It’s worth noting, however, that only 12% of respondents indicated their work-life balance has worsened, compared to 16% last year.
Although many tech professionals have returned to the office, many of the open-ended responses to this question suggested dissatisfaction with return-to-office policies as a source of subpar work-life balance. Given how much tech professionals value working remotely, it may be no wonder that work-life satisfaction can dip if employers don’t strike the right balance between remote and hybrid work, as witnessed by the very public drama over scheduling at companies such as Google.
Thinking about your work-life balance now, would you say it is better, the same, or worse than it was last year?
Gig Prevalence and Contract Work
Contract and project work has always been popular with both employers and a subset of tech professionals. With widespread layoffs earlier this year and pervasive economic uncertainty, tech companies have been bringing on more contractors for projects that were previously handled by full-time employees.
More than three in five of our HR professional respondents said their percentage of contract or contingent workers increased. With many IT staffing agencies offering the flexibility of contract or project work along with many of the benefits enjoyed by full-time employees, we could see a higher percentage of tech workers flocking to contract roles looking ahead.
Tech leaders cited greater agility and the capacity to accomplish short-term workplace goals and projects as the main drivers behind increased contract work. And plenty of tech professionals are game for contract and freelance work due to its flexibility and opportunities for higher hourly wages.
Contract work has always been a prominent choice for tech professionals. But factor in record pay expectations and rising consumer prices, and it makes sense that even tech professionals with full-time employment may consider gigs and side hustles for extra cash: 47% of tech professional respondents said they have (or had) a gig, and the majority (78%) said they pursued gigs to supplement their income.
Workers can be nervous about informing their full-time employers about their side gigs. But the vast majority (nearly nine in 10) of our HR professional respondents agreed it’s acceptable for full-time employees to have side gigs as long as they don’t interfere with work responsibilities (this is in line with employers across industries).
Which of the following describes why you have or had a side gig/job?
Diverging Outlooks on the Economy
Despite a drop in tech job postings after a banner year in 2022, along with layoffs at the biggest tech companies and a widespread sense of economic uncertainty, the tech unemployment rate remains encouragingly low. Tech professionals have considerable opportunities across a wide range of exciting industries.
Economic confidence among tech professionals was mostly split between optimism (33%) and pessimism (26%), which is a notable change from last year, when more respondents were pessimistic. There’s a wide gap in economic confidence between tech professional and HR professional respondents, with the latter being more than twice as optimistic. That HR optimism could reflect broader corporate sentiments, which in turn could translate into a sunny picture for long-term hiring.
Moreover, only twenty-three percent of HR professional respondents to our survey reported feeling burnout, despite reported increases in HR professional burnout and layoffs in the broader economy.
What is your overall confidence level surrounding economic conditions?
More than half of tech respondents haven't been impacted by layoffs (either personally or at their company). That’s despite 10% of respondents having been laid off, 19% seeing their team members laid off and 20% expecting layoffs at their company at some point. (Of the 10% who were laid off, more than three-quarters immediately started searching for another job.) Tech professionals believe their skills are marketable (with good reason), and that, even if they’re impacted by layoffs, other companies will need their services.
Notwithstanding economic fears and expectations of layoffs, the vast majority of tech professional respondents (82%) believe the tech profession will grow over the next five years; moreover, only 7% of respondents said they have or are considering changing to a non-tech profession or non-tech industry.
Respondents expect the following technologies to enjoy the most future growth: AI and machine learning (82%), cybersecurity (59%) and cloud (51%). Recruiters and hiring managers who want to attract tech professionals can highlight their companies’ training and education offerings, especially if it involves instruction in such cutting-edge tech. Training existing employees in the nuances of AI and cloud, for example, could also alleviate some of the pressure to hire expensive specialists.
Which of these areas do you expect will see the most growth in jobs/careers over the next five years?
The Bottom Line
When it comes to salary transparency and economic outlook, there are significant divergences between tech professionals and HR professionals. If recruiters and hiring managers want to retain their best talent, they’ll need to recognize and adapt to tech professionals’ need for solid work-life balance, preference for working side gigs and more.