The 2022 Tech Market in Review & Expectations for 2023

Hamilton Forth consultant, Rachel Sim reflects on the 2022 tech market and discusses the expected market trends for 2023. 

The Tech Market

Last year at Hamilton Forth we saw the tech market remain buoyant across both contract and permanent vacancies. Our contract book was dominated by Project Managers and Business Analysts; perhaps an insight into the level of change that organisations are going through post covid and the importance of effective resource management and delivery. Our permanent vacancies were led by Software Engineering and Data – another insight into the importance of embracing change and continuous development.

Recruitment was of high importance across all industries and sectors. We worked closely with clients from a broad range of organisations: public sector bodies, to multinational businesses, to tech scale-ups. We expect our opportunities to be even more diverse as we continue through 2023.

Salaries

Salaries across the tech sector continued to increase an average of 5.7%, 0.3% higher than across other industries. At the end of 2022, we compiled our Annual Salary Guide outlining salaries across the contract and permanent market by specialism.

Given the economic challenges predicted during 2023, it would be expected that investment in tech may reduce. However, Gartner anticipates global tech spending to increase by over 5%; once again demonstrating the value that organisations now place on technology.

Working Patterns

Trends that emerged in 2020 and 2021 remained prominent throughout 2022. Remote and hybrid working dominated, with very few organisations enforcing 100% office-based roles. This trend has had additional impacts on aspects such as culture and dress code. People are no longer expected to sit at their desk from 9am – 5pm five days per week in order to add value, and gone are the days when a suit and tie were required for every meeting. Organisations are embracing flexible hours and patterns to allow employees to have a better work/life balance and fit work around other commitments such as childcare.

However, some further consideration is required to ensure the continued success of home working. Managers had to pivot immediately to home working and supporting their team remotely during the pandemic, with very little training on how to do so. They can no longer watch their team at close quarters, so a level of trust and understanding must be developed between employees and managers. It is vital for managers to put the resources and support in place to allow employees to continue working at their optimum level. This all requires a change in expectations; rather than focusing on the number of hours employees sit at their desks, managers should focus on their team’s outputs to measure success.

The Great Resignation and Mass Layoffs

While the Great Resignation emerged in 2021, it continued throughout 2022. 2022 saw 20% of the population consider a change in hopes of higher salaries, flexibility and a higher level of job satisfaction. Despite this, throughout the year recruiters and employers faced a candidate-short market, with demand for top tech talent exceeding availability. This skills shortage has been highly publicised and has fortunately created an incentive for people to consider a new career in tech. Organisations have now started to consider reskilling their existing teams to bridge skills gaps and hiring people from less conventional educational backgrounds such as those who have embarked on condensed tech training bootcamps.

2022 started with employees having a high level of control over their jobs, flexible working and salaries due to the talent shortage. However, economic pressures such as the cost-of-living crisis and the recession have caused concerns over people’s job security and organisations’ futures. As these challenges continue through 2023, there may be a lack of movement in the tech market as people are reluctant to make a move during uncertain times, further fuelled by high-profile mass layoffs at organisations such as Twitter and Meta.

Opportunities in 2023

With a challenging economic climate, the circumstances employees and employers will find themselves in will create huge opportunities for growth and change in 2023.

We will likely see more growth within the contract market as organisations try to avoid long-term investments. Although contractors tend to be more costly on a day-to-day basis, organisations will utilise their skills to fill immediate needs in 2023 and avoid committing to long-term expenditure. This may incentivise the permanent workforce to consider moving into shorter-term contract positions if faced with redundancy or a lack of job security.

The past few years have proven that although salary is of high importance to employees, additional incentives such as flexible and remote working will ensure organisations can attract and retain top tech talent. Organisations should ensure managers are given appropriate guidance and the tools required to successfully lead their teams remotely, as well as promoting their organisation’s culture within any recruitment processes.

For a confidential discussion around your technology career or recruitment needs, please contact [email protected].