How Banks Survive the Great Resignation
The US has long bemoaned engineer shortages. Staying competitive and secure in the global economy requires skilled workers at the forefront of science and technology, after all.
But we’re seeing a shortage like never before.
Four million Americans quit their jobs in April 2021, just a fraction of the 41% who plan to do so this year. Burned out from working through COVID-19 mandates and emboldened by the talent shortage it kicked off, workers now find it easy to leave employers in search of better pay and working conditions.
Dubbed ‘The Great Resignation’, it’s the reason many industries now struggle to fill empty positions and keep hires on staff. Development teams, and the financial institutions that depend on them, are some of the hardest hit.
However, the dearth of engineers in tech has a longer history. To address today’s hiring struggles, it’s important to understand what contributed to them in the past.
Tech’s Historical Talent Shortages
Even pre-pandemic, 67% of tech leaders reported that a skills shortage was preventing their organization from keeping up with changing technology. Not having enough engineers was already halting innovation, slowing business growth, and weakening competitive edges.
The problem wasn’t a lack of applicants. In 2018, employers reported 43 tech applicants per hire. The problem was a lack of qualified candidates.
Software development roles were, and still are, the most difficult to fill. In fact, 61% of HR professionals in one survey said their biggest recruitment challenge in 2021 is finding qualified developers.
Yet, the number of software developers has grown consistently since 2018, with 24.5 million developers worldwide in 2020. That number is expected to reach 27.7 million by 2023.
Where are all these developers hiding? Perhaps it’s an issue of demand.
Fortune 500 companies today need to hire droves of engineers just to maintain basic digital products. Job search engines routinely see over 100,000 tech job posts a week. Giants like Facebook, Google, Apple, and Amazon account for hundreds each.
How The Shortage Bodes Well for Banks
What we’re seeing today isn’t really all that new. Ten years ago, Google, Amazon, and Facebook were pilfering engineers from companies like IBM.
Now, while the FAANG companies compete to staff thousands of positions, global funding for new ventures and tech startups is up over 157% compared to 2020. With competitive salaries and fewer seats to fill, startups and smaller agencies might just have what it takes to lure talent away from established corporations.
Talented engineers want to be a part of the leading edge of technology. With ample funding and less political baggage and bureaucracy, startups and agencies are now luring talent away from the tech giants.
Exciting opportunities to work in crypto, cybersecurity, and especially AI also attract developers when compared to the broad project scopes for similar pay in corporate tech. Fortunately, this puts financial institutions in a good position to attract talent.
What Banks Have to Offer Developers
With exciting projects and narrower scopes, financial institutions attract developers looking for more autonomy in their work. Whether hiring directly or through an agency, banks can easily tap into the best talent pools for high quality engineers.
When it comes to hiring, of course, American banks have to contend with numerous hurdles. They can only hire within the US, for example, taking into account requirements like KYC, security, and risk reduction. This limits their talent pool.
To overcome these challenges, banks should consider what we already know about the history of engineer shortages. They can address the most common issues by:
- creating attractive opportunities for engineers
- changing the way financial institutions hire, train, reskill and upskill developers
- working with partners who can circumvent hiring hurdles
Using one or a combination of these approaches will help banks hire and keep development talent.
The Way We Attract and Retain Talent is Changing
The Great Resignation forced employers to reconsider hiring and retention strategies. Today’s talent craves flexibility and autonomy as much as it wants competitive pay and benefits.
To compete, financial institutions must find ways to be agile when it comes to sourcing qualified software developers. Outsourcing to companies and agencies like Kunai is one solution. Smaller talent-acquiring units can move quickly and don’t have to contend with the same hiring limitations as banks.
Once acquired, training, upskilling, and reskilling that talent is key to retention. Next up, we’ll discuss how developer education is changing and how banks can get in on the action.