A new report shows that tech companies are employing highly-skilled freelancers and independents more often to deal with talent shortages.
The Great Resignation continues to wreak havoc more than a year later, with 44% of tech founders and executives reporting that “a significant number of their best performers” have left their jobs. their company, according to a New report released from A.Team and MassChallenge. Factor in early-stage startups and that number skyrocketed to 53%.
“Since The Great Resignation began last spring, it has been a source of fascination in the tech sector, which has seen the highest resignation rates of all industries,” according to the report. The report, citing a 2021 Harvard Business Review article, said resignations in the tech sector had increased to 4.5 percent.
In response, 73% of tech companies have now attracted freelancers or independents who are being integrated into mixed teams with full-time employees. An additional 11% plan to do so soon.
Nearly half of respondents (42%) said freelancers or independents make up more than a quarter of their total workforce. Why? 70% of respondents said that freelancers or freelancers give their businesses more agility in times of economic uncertainty, while 70% say jobs from distance makes them more likely to become freelancers, the report said.
UNDERSTAND: Independent talent is an important workforce strategy for companies facing persistent labor shortages. (TechRepublic)
In the past, freelancers often handled repetitive, outsourced work individually, the report said. Now, thanks to the fact that many teams are now in the cloud, it’s a lot easier to build hybrid teams.
It looks like the situation will improve soon. One McKinsey Research July 2022 found that 40% of workers overall plan to quit within the next three to six months.
Hiring issues continue for tech leaders
The report says that although The Great Resignation is still active, hiring plans are still increasing over the past six months for 45% of respondents. For founders and executives in the Series B to IPO stage, that number spikes to 59%.
However, executives say they are frustrated with the traditional hiring model, with 67% saying it needs an overhaul because it’s too long and expensive.
The report notes: “This is especially true when it comes to product and engineering talent. “Sixty-two percent of tech founders and executives say it takes on average four months or more to fill new product and engineering roles.”
What’s more, a whopping 80% said they’d be willing to hire someone without a college degree – for any role.
More than 40% of respondents said they have increased investment in career development and upskilling programs in the past year to retain talent.
This led 80% of respondents to invest in formal career development and upskilling programs, with 87% saying it was important to their employees and 41% saying they were particularly increased investment in skills improvement programs over the past year.
For 62% of respondents, switching to a more flexible working model during the pandemic has increased employee productivity, but 37% said they plan to work in the office more during the year. next.
Impact of downtown economy on priorities
Although leading venture capital firms have warned tech founders and executives to “avoid fundraising until 2024,” the report says 60% still plan to raise money in the next 18 years. next month. They rank revenue growth as their top priority, followed by fundraising.
Low on the priority list? According to the report, reduce the burn rate and gain profit, by only a third (14%).
High concern about stress at work
But tech founders and executives worry about employees and themselves: 72% say they worry about their employees’ mental health, and 62% say they worry about their mental health. their own god.
They were similarly focused on stress reduction and motivation management – 63% said they were worried about employee burnout and 59% expressed concern about their own burnout.
Innovative leadership solutions are trending according to the status quo
Another interesting finding from the study is that there is a generation of technology leaders that are inherently innovative and disrupt the status quo of the workforce and organizational structure, removing the “wait and see” mentality. in uncertain economic times.
The prevalence of remote work, independent tech talent, and a mix of freelancers and full-time employees seemed like a fantasy a few years ago, the report said. but now that’s what many founders, executives, and tech workers want’. “This trend is only likely to accelerate, with bumps along the way. As they change the way they hire and embrace the new talent pool of skilled independent workers, founders will have to continue to rethink how they form, manage, and optimize teams. . “
With these changes, new questions tech founders and executives will have to address around benefits, mental health, and compensation, the report notes.
A.Team and MassChallenge collaborated on the first Technology Jobs Report, surveying 581 technology founders and executives (C-Suite or divisional leader) based in the US. All respondents were surveyed in July 2022 through the MassChallenge network of founders, experts and partners.
