TREND 3 OUTSOURCING IT TALENT ABROAD WITHOUT AN EMPLOYMENT CONTRACT
When we were preparing IT recruitment trends and predictions for 2022, we could not have foreseen how the world would turn upside down with a war waged on Europe's doorstep.
In addition to the social and humanitarian suffering caused by Russia’s war with Ukraine, the economic situation in Europe has become strained, to put it mildly. Power and money dynamics have shifted in many industries, and financial stability and investment have quickly been substituted by caution and austerity.
Before the war, Russia and Belarus were a demand- ed IT talent pool. Since February 2022, Western companies and tech recruitment agencies no longer look for IT talent in Russia and Belarus, and many IT specialists have already left these countries.
Economic sanctions and supply chain disruptions have affected many global markets, causing a surge in commodity prices and record-high inflation.
Candidates now expect not only higher salaries but also a new level of work flexibility. Having tasted the benefits of remote work, the post-pan- demic time workers are no longer willing to give it up entirely. As a result, hybrid work is here to stay – even in industries that weren’t pioneers of working from home.
Inflation is putting pressure on compa- nies to raise salaries. For now, the raises aren’t able to keep up with the inflation, even though IT salaries have been steadily growing for many years.
Maris Tepers, CEO of MateHR
What other trends surfaced last year and will steer the IT recruitment ship throughout 2023? As a tech recruitment agency with a vast network of local tech recruiters in Europe and beyond, we’ve distilled our observations and data into six main trends that are set to shape the IT recruitment scene for the next 12 months.
EMPLOYERS PREFER HYBRID TO REMOTE;
IT PROFESSIONALS DISAGREE
Remote and hybrid work formats are no longer an optional perk – today, candidates expect flexible work options as standard when they apply for jobs. Companies must provide such flexibility to attract and keep the best talent.
Most IT companies still prefer their employees – even the remote ones – to be located in the same region, if not the same city as their office. This strategy makes it easier to assemble the team for occasional comprehensive meetings or team-building events.
Meanwhile, IT professionals prefer remote positions. Last spring, companies such as Google and Apple began requiring employees to return to offices on a hybrid schedule and faced a controversial reaction from their staff. This signaled a general sentiment among IT workers that are now used to working remotely – and prefer things to stay that way.
When it comes to working on-site full-time, the resist- ance among workers is even more pronounced.
ADP Research Institute’s report “People at Work 2022: A Global Workforce View” found that two-thirds of workers (64%) have considered (or would consider) looking for a new job if their employer requested them back in the office full-time. Resistance to returning to the office full-time is even more pronounced among 18-to 24-year-olds (71%).
80-90% of our clients are looking for people who could meet face-to-face once or twice a month at the very least. From our daily work, we see only 10-20% of IT companies looking for fully remote candidates who are up to meeting only once or twice per year.
Maris Tepers, CEO of MateHR
Based on our data, over 50% of job
offer rejections last year stated hybrid work or on-site work as the main reason, regardless of the offered position or salary.
Marija Evita Tauriņa, Head of International Talent Acquisition
WITH RELOCATION IS BACK
In 2020 and 2021, relocation for work slowed down dramatically, almost coming to a full stop during the darkest times of the pandemic. Since the second half of 2022, global IT recruiters have witnessed the comeback of international hiring with relocation, which is growing in momentum.
Many companies need to restart international hiring and employee relocation processes that were practically abandoned for two years; therefore, the changes are happening gradually. However, we expect that in 2023 hiring with relocation will regain its place in the international IT recruitment scene.
The slow return to relocating employees for work isn’t a mass movement yet, but we see many employers discussing this option for 2023. Most businesses stick to hybrid work and aren’t considering switching their teams to 100% remote work. Many companies still find it crucial to be able to meet their employees face-to-face at least once per month.
Maris Tepers, CEO of MateHR
IOUTSOURCING IT TALENT
ABROAD WITHOUT AN
There is a globally growing demand for options that allow to “hire” IT professionals in countries where companies don’t have their own branches. The two most common ways to make this happen are via B2B contracts or via companies offering global employment services.
Hiring IT professionals through B2B contracts is a growing trend across Europe, with such contracts being common in Poland, Romania, and elsewhere. Based on data from our IT recruitment agency’s network, the increase in such employment types during the past two years is 200%.
B2B contractors are self-employed and usually receive a higher salary but lower social benefits, as the employer does not pay taxes and insurance for them. That said, it’s increasingly more common for companies to perceive B2B contractors as full-fledged team members, awarding them different company perks like extra days off, educational budgets, and wellness initiatives (except health insurance).
GLOBAL EMPLOYMENT SERVICES
Global employment companies help businesses quickly hire team members in a new country, handling the legal, tax, and HR processes in their place. Such services help to get great talents on board much quicker and eliminate bureaucratic obstacles.
Freed of the need to set up their own entity or subsidiary, many IT companies find it easier to expand and carry out projects across Europe and beyond.
IT EMPLOYEES: CONSIDERATIONS FOR 2022
Even before the pandemic, remote work was on the rise, but since 2020 a rapidly growing number of companies are adopting hybrid and fully remote work models for the long haul.
There’s also been an increase in remote-first companies that assume employees are working outside of the corporate office all of the time or with rare exceptions.
Remote-first companies set up their operations and communication channels regardless of where people work from. Currently, around 16% of companies globally are 100% remote, including well-known startups like Buffer, GitLab, Toggl, and Zapier.
REMOTE WORK IS MORE PRODUCTIVE THAN YOU MAY THINK
Importantly, the concern about the loss of productivity when employees work from home has been largely refuted. In fact, many surveys and reports show that remote employees are more productive than their in-office counterparts. Possibly thanks to this realization, we have also seen a reduction in the usage of time tracking tools.
As long as the employers see the results their teams produce, there’s no need for spying or monitoring, right? In addition, monitoring software is often negatively perceived by employees, urging managers to refrain from using such tools and instead rely on employee performance.
Does remote hiring mean reduced costs?
Hiring remote employees not only removes relocation expenses but also office-associated costs like furniture, office equipment, electricity bills, etc. Some studies also show that remote employees take fewer sick leave days. On the other hand, progressive companies already cover home-office-associated costs as a part of their employee benefits package.
In fact, a significant part of employees may already be expecting such moves from their employers. According to an OwlLabs study carried out in the UK in 2021, 40% of employers provided a one-time payment to employees for WFH expenses, and 35% provided a monthly stipend.
A GROWING TREND
The real estate market is experiencing changes due to remote workers increasingly realizing that they no longer need to live close to their offices in metropolitan areas. Studies from 2021 show that moving became a major trend during the pandemic.
Of those who worked from home during the pandemic, more than a quarter relocated during that time, with the majority moving from urban to suburban or rural areas and 13% relocating to another country.
Improved employee wellbeing vs. “work from home fatigue”
Remote work allows for greater flexibility and thus improves the worklife balance of employees. Increasingly more sustainably thinking employers choose to hire remotely and enable their team to work from anywhere and possibly move to calmer and greener areas, thus improving their health and reducing geographical inequality.
Remote work also eliminates the need to commute, giving people on average one extra hour per day and doing a great favor to the environment. In addition, working from home helps workers save lots of money, due to skipping lunch, saving on transportation, not having to dry clean clothes, etc.
Despite all the benefits, having a fully remote team is not suitable for all people and all companies. First of all, it’s more challenging to determine if the person is a good fit for the team without meeting them in person.
Onboarding recruits remotely, especially for highly technical positions, can be challenging. Not only the job training itself is difficult without the tutor being physically present, but the recruit's motivation and success are harder to measure.
In addition, some managers report impeded creativity in a remote work setting. Brainstorming and collectively developing innovative approaches is more complicated than when everyone’s in one room talking face to face. From the employee’s perspective, the three biggest challenges associated with remote work are unplugging after work (27%), loneliness and missing face to face socializing (16%), and difficulties with collaboration (16%). Not everyone is cut out to draw clear boundaries between work and private life. Many people report feeling stressed about juggling work, family, health, and other responsibilities in the same environment.
of hiring remotely:
+ Saving time and money on relocation-related paperwork and procedures
+ Access the widest possible candidate pool Save on office-associated costs
+ Give greater flexibility and better work-life balance to your team
+ Reduce the environmental impact of commuting
of hiring remotely:
− Challenging to onboard and train junior employees
− Less effective communication
− More challenging to build and maintain team spirit
− Potential bureaucratic challenges (a traditional employment contract would be binding in one country only)
Predictions for remote IT recruitment in 2022:
A growing number of companies will try hiring remotely (we receive many questions about how to organize the remote hiring process and which countries to search in).
Employees will increasingly be covering WFH-related expenses, like tech equipment, internet bills, or ergonomic furniture.
There will be more adopted pets! Fun fact – of those that worked from home during the pandemic, 51% adopted a cat or a dog.
With remote work being here to stay, more and more people will choose to move away from cities to greener and calmer areas.
We will see an increase in new and progressive tools and software that help manage remote teams, including virtual offices, augmented reality work environments, and advanced multimedia communication tools.
2022 – A HYBRID AND HUMAN-CENTERED YEAR
Due to the pandemic, remote and hybrid work formats are no longer just a perk some employers can choose to offer to their workers, but a necessity for all. FlexJobs’ 10th Annual Survey found that 58% of respondents would “‘absolutely’ look for a new job if they cannot continue remote work.” In addition, 79% of respondents would be more loyal to their employer if they had flexible work options.
According to an April 2021 survey, 90% of senior executives now expect to work from home. And a quarter of job seekers would actually turn down a job offer if it did not allow a WFH option in the current environment.
In short – candidates will expect flexible work options as standard when they apply for jobs. And companies will have to be able to offer such flexibility if they want to attract and keep the best talent.
A MORE DIVERSE
As illustrated by the B2B contract trend mentioned in the International recruitment section, new work formats are becoming more and more popular. For example, we’re seeing more positions for contract work, project work, and one-off commissions. More people are finding that self-employment or gig-work is a better option for them than conventional employment.
These diverse kinds of work will continue to grow in 2022, forcing companies to adapt to a far more diversified jobs market. Modern workers want more flexibility, and traditional salaried and hourly jobs aren’t enough anymore.
Recruitment trends to follow in 2022:
Companies will increasingly use AI and automation in their recruitment process, for example, software that can filter out the first round of candidates.
Mental health and employee work life balance will become the focus of more companies. Many will introduce mental health support mechanisms like extra days off or paid therapy sessions.
Candidates now look for companies that match their values and morals, so businesses should emphasize their mission and culture in job adverts.
The increase in demand and living costs will urge candidates to ask for higher pay levels than before.
Candidates – especially millennials and GenZ – will expect their potential employers to demonstrate care for the environment and deliver concrete action in this regard.
HOW TO FIND THE BEST HIRING TACTIC FOR YOUR COMPANY?
We hope this white paper brought you closer to choosing the best recruitment tactic for your company, with foresight on what to expect from this year’s job market. Whichever option you find suitable, the best IT recruitment results can be achieved with the help of professional tech recruiters. MateHR is an IT recruitment agency with extensive experience in all hiring formats discussed in this white paper. Contact us for recruitment solutions tailored to your unique hiring needs: