How IT can overcome the tech talent shortage.
IT may be facing a talent crisis, but leaders can still build an agile workforce primed for the future. How? By embracing a skills-based strategy.
Learn more about the IT skills gap, how a skills-based approach can close it, and how AI can help you find the talent you need—and even prevent skills gaps from occurring.
What is the tech talent shortage?
Many companies struggle to find employees with the necessary technology skills to help them achieve their digital transformation goals. This is known as the IT talent shortage.
Nearly 90 percent of IT leaders say recruiting and retaining tech talent is an ongoing challenge, according to Deloitte. A global analysis by Korn Ferry estimates the digital skills gap will leave 4.3 million tech jobs unfilled by 2030.
When companies struggle to acquire and retain talent, it impacts their operations. Product release timelines, customer satisfaction, and revenue goals are affected—leading to an estimated $6.5 trillion loss by 2025, per IDC.
Hiring tech talent is difficult for several reasons. First and foremost, businesses face competitive pressures, global disruptions, and rising customer expectations that require modern technology solutions. This pace of change has increased the need for specialized skills, and companies are struggling to find talent.
To ensure operational excellence and drive organizational growth, CIOs must collaborate with CHROs. A strategic alliance between these leaders combines IT’s technical understanding and awareness of specific required skills with HR’s broader expertise in talent strategies and employee experience. This partnership will help ensure that the company is able to attract and retain qualified candidates who can close the IT skills gap.
90%
of organizations will face severe impacts from the IT skills shortage, with up to $6.5 trillion in losses by 2025.
Two-thirds
of global enterprises saw revenue, quality, and competitiveness decline as a result of the skills shortage in 2023.
IDC, “Skills Forward: Staying Competitive Among the Worsening IT Talent Shortage”; 2023.
Which skills are in demand in IT now?
In the next 10 years, intelligent automation could free up to 30 percent of IT workers' time, changing the skills that are in demand. This means that technical skills related to artificial intelligence (AI) and emerging technologies are becoming more important, as well as leadership and change management skills.
Research about the digital skills gap by McKinsey, Robert Half, and IDC has identified the following tech skills are the most in demand:
- AI: Generative AI and machine learning (ML) experience is critical, as is expertise in natural language processing, data science, and regulatory compliance.
- Cloud computing: DevOps, Kubernetes, and Terraform skills are particularly scarce and highly valued by hiring managers.
- Trust architecture and identity management: Security, privacy, and resilience have become more important than ever due to the rise of digitally enabled products and services. As a result, organizations need experts with risk analysis, cryptography, and identity management skills to safeguard digital data.
- Software development: Programming languages such as JavaScript touch nearly every IT job role, not just for software engineers, so fluency is a highly sought skill. JavaScript is especially important, as it is the most common coding language in use today.
- Cybersecurity: The need for security expertise is increasing. Companies are seeking tech talent with skills in:
- Zero-trust architecture: A security system design that mitigates risk around decentralized data.
- Homomorphic encryption: A type of encryption that allows users to work with encrypted data without first decrypting it, thus giving third parties and collaborators safe access to large data sets.
- Behavioral analytics: A security approach that uses AI and ML to proactively identify potentially problematic user behavior or device activity.
- Task and workflow automation: CIOs increasingly aim to boost productivity through automation and urgently seek experts who can create low-code/no-code approaches.
While technical skills remain crucial for IT teams, industry executives surveyed during Deloitte’s 2023 Global Technology Leadership Study highlighted the growing importance of nontechnical skills:
- Leadership: Leadership skills are crucial in the era of AI. In-demand skills include:
- Operating with a strong focus on driving results
- Seeking and valuing different perspectives
- Communicating effectively
- Motivating and inspiring others
- Establishing ethical AI guidelines
- Problem-solving and decision-making: IT talent requires a problem-solving focus to execute strategically and leverage AI to assist in critical decision-making.
- Relationship skills: By cultivating strong interpersonal skills, technical employees can pave the way for career growth and establish a productive working environment. These skills include communication, collaboration, and partnership skills, as well as mastering tech solutions that enable collaboration.
“Arrow Electronics is focused on automation, AI, and machine learning, driving development opportunities with Workday Skills Cloud, Career Hub, and Workday Learning.”
—Senior Manager, HR Technology, Arrow Electronics
Can AI help close the tech skills gap?
Solving IT’s talent crisis won’t happen by focusing on head count alone. Instead, innovative CIOs are leveraging AI and ML advancements to support HR in cultivating a workforce that prioritizes a skills-based strategy. This approach empowers organizations to move from the limitations of traditional role-based jobs and find the talent they need within the workforce they have. To close the IT skills gap, AI and ML optimize this process by leveraging data to quickly surface the skills needed and match them with business needs and priorities.
When using AI to optimize talent and close the tech talent gap, it’s critical to keep customer and stakeholder trust top-of-mind. Organizations should seek tech solutions that make clear commitments to a responsible and ethical AI approach. By upholding transparency to establish a culture of integrity, companies can shape a future in which AI becomes a driving force not only for business success, but also for human-centered, positive change.
If a skills-based strategy is the lifeblood of a future-ready IT function, AI is the beating heart that empowers leaders to:
Identify existing IT skills and better match work to roles.
An employee’s role doesn’t tell the whole story when it comes to their skill sets, and resumes don’t reflect the skills learned after they accept a new role.
AI can help organizations better understand the skill sets of their employees by matching those skills to business needs and priorities. Then, it can help identify upskilling opportunities to address skills gaps. For example, Workday Skill Cloud, a technology framework embedded in Workday Human Capital Management (HCM), leverages ML to help understand the components of a skill and connect those components to other skills. That capability helps infer adjacent skills that have not been explicitly entered by employees.
Leverage talent outside of traditional IT roles.
CIOs can free up IT resources by embracing AI-powered self-service tools that allow non-tech employees—or “citizen developers”—to perform tasks that would otherwise fall to IT.
With low-code/no-code development tools, for example, business technologists can build customized applications with little to no technical expertise. Developers and IT can also take advantage of low- and no-code tools to drastically speed up their workflows.
These advancements in technology can create a positive ripple effect throughout the entire organization, too. Productivity soars, IT can focus on more meaningful and satisfying work, employee experiences and retention improve, and businesses experience a lift in ROI.
Develop an agile and flexible talent strategy.
Research suggests that 85 percent of jobs that will be available in 2030 haven’t been invented yet. An AI-powered approach can help organizations navigate this new reality by leaving behind static, siloed approaches to hiring, employee development, and talent management. Instead, real-time, connected data helps IT leaders build a forward-thinking strategy that maximizes a “grow, hire, flex, augment” framework to drive agility.
“With Workday Skills Cloud and Workday Learning, HPE can identify employee skills and talent so it can invest in employee growth and development and aid retention.”
—VP of Technology & Innovation, HPE
Overcoming the IT tech talent shortage.
To address the existing technology skills gap, companies can use the very technology that created it. This involves rethinking your IT skills approach, building a skills ecosystem with quality employee data, and then using responsible AI to implement and accelerate your skills strategy.
Use quality data to build a skills ecosystem.
To build a skills strategy that solves for tech shortages, organizations require visibility and insight not only into the capabilities that exist, but also into those they will need in the future. To accomplish this, organizations must leverage a base of readily available, high-quality, relevant, and accurate data that only a unified, cloud-based platform can deliver.
Companies should begin by using large data models to capture employee self-assessment data and skills requirements for roles, teams, and functions. This involves importing relevant skills data from third-party systems and blending it with internal data, and then processing these vast stores of unstructured and structured data to extract crucial insights.
This cohesive approach creates a powerful skills ecosystem that allows leaders to gain a complete picture of their people, decide how best to leverage the resources they have, make data-driven decisions around talent and staffing, and plan for future workforce needs.
Use responsible AI to accelerate your IT skills strategy.
The best skills ecosystems utilize AI to:
Better understand evolving roles
Improve upskilling practices
Facilitate knowledge transfer
Establish best practices to prevent knowledge loss
Model workers’ skills
Make recommendations to align technology skills with future business needs, improve business agility, and elevate employee experiences
But leveraging AI to close the tech skills gap must be done in a balanced way that protects individual rights and privacy. By implementing unified data solutions with a comprehensive governance program and clear ethics principles, organizations can drive actionable skills insights while maintaining trust and compliance, data security, and privacy.
Use AI to refine the talent acquisition process.
Forward-looking organizations use AI to accelerate their skills strategy through a unified, skills-based approach that:
Creates job descriptions highlighting key skills requirements
Matches labor demand with worker qualifications, skills, availability, and preferences
Screens large volumes of job applications to identify candidates with the right skills for specific roles
Generates personalized learning articles for upskilling
Facilitates career development paths for new hires and existing employees
Provides visibility into hiring performance and skills programs
Champion trustworthy AI to empower your people, not replace them.
Responsible AI seeks to amplify human potential; positively impact society; champion transparency and fairness; and deliver data privacy, security, and compliance.
An ethical, human-centered approach should form the cornerstone of AI strategy. In practice, it means that organizations will leverage AI to automate repetitive, manual tasks, not replace individual roles. This helps boost operational efficiencies, drive faster, more confident decisions; and increase employee satisfaction by allowing individuals more time to focus on higher-level, strategic initiatives.
Rethink your IT skills approach.
In an era of persistent talent gaps, the successful deployment of an enterprise skills strategy is critical to organizational growth and can yield dividends.
Partner with us to cultivate a workforce that’s more adaptable and that aligns with your current and future business needs.
Closing the IT skills gap with Workday.
Workday AI.
AI is embedded into the core of the Workday platform, enabling organizations to best identify, manage, and optimize employee skills. The Workday intuitive single pane of glass interface lets users “see” into those skills, by providing them with insights from many different resources, thus allowing them to best utilize those skills where they are needed most.
Workday Skills Cloud.
Workday Skills Cloud provides a cohesive data model, breaks down key blockers, and processes large amounts of data into consumable, actionable formats. Workday Skills Cloud is native to Workday Human Capital Management (HCM), but customers can get even more from this solution by pairing it with the following:
Workday Prism Analytics.
Workday Prism Analytics provides a secure, user-friendly platform to unify, manage, and transform data for various reporting, analytics, or planning needs. With robust audibility and data lineage capabilities, no coding or special licenses are required.
Workday Extend.
Workday Extend helps organizations create apps that accommodate their unique business needs and empower nontechnical talent through low-code and no-code capabilities. Workday Extend enables companies to leverage the same technology, security, logic, and application components that power Workday through an intuitive, browser-based experience.
Workday Talent Optimization.
Workday Talent Optimization supports talent mobility by connecting an organization’s workforce with internal opportunities matched to their skills, experience, and interests. Once connected, the system then provides workers with insights that will best enable them to take advantage of those opportunities.