THIS WHITE PAPER IS DIVIDED INTO THREE MAIN APPROACHES TO RECRUITMENT – HIRING LOCALLY, INTERNATIONALLY, AND REMOTELY
This white paper is brought to you by Mate HR – an IT recruitment agency with a vast network of tech recruiters in Europe and beyond. This white paper includes the latest research and statistics on IT recruitment, along with hands-on experience from Mate HR’s work in the field.
Maris Tepers – the founder and CEO of MateHR – has more than a decade of experience in IT recruitment.
2022 AND THE NEW AGE OF IT RECRUITMENT
2021 was the year that cemented the new pandemic-induced conditions in everyone’s minds. As opposed to 2020, we were no longer naively hopeful that this crisis would pass soon and that the business and hiring world would go back to “normal”. 2021 taught us that instead, we should each search for the “new normal” in our industry and our business – a new status quo that would satisfy business growth and keep our employees happy.
First of all, last year tech companies across the world adopted remote and hybrid work models for the long haul. While some IT companies foresee a return to in-office work in 2022, others have foregone the idea of a physical workplace—and most will probably adapt to some form of hybrid work. Microsoft’s Work Trend Index 2021 found that 66% of employers worldwide are redesigning their workplaces to accommodate hybrid work arrangements.
The major shift to remote work caused changes in financial remuneration within the European IT industry. In 2021, companies intensified their search for talent outside their home countries, and some opened offices in Southern, Central, and Eastern Europe to increase their chances of recruiting tech specialists. Now we see that candidates in these regions become more and more demanding and their growing salary expectations are gradually transforming the market situation in their home countries.
On the other hand, we see that candidates are again more open to relocating, in comparison to the situation in 2020. Local language knowledge requirements are becoming less relevant, with English knowledge dominating as a mandatory universal language.
Stats that will shape the recruitment world in 2022
As 45% of employers said they couldn’t find the workers with the skills they need in 2021 and 46% of businesses have struggled to recruit for roles that require data skills, you have to be proactive and inventive to make your offer stand out in the eyes of job seekers. As we enter 2022, these statistics can determine your business’ hiring success and get your company ahead of the competition:
Over 75% of professionals are passively available for new roles, even if they aren’t actively seeking out a job. Therefore don't wait for staff to become available – go get the ones you want.
54% of recruiters offer additional training and development to overcome talent shortages. If they can’t find candidates with the needed skills, they train them for the job.
64% of recruiters say they can find top talent easier when promoting it as a partially or fully remote position.
73% of millennials found their jobs on social media.
LOCAL TECH RECRUITMENT: PRESENT SITUATION AND FUTURE TRENDS
Recruiting locally is the go-to tactic for many companies because it seems straightforward and less problematic. Local recruitment may also be the best tactic when looking for one or two new employees.
Local recruitment is also speedier and cheaper than international talent scouting, as no extra time and funding will be needed for arranging paperwork and relocation. That said, your choices will be limited by the local talent pool of your city or country.
On the employee side, an astounding 97% of workers now desire some form of remote work even after the pandemic recedes. Namely, 58% of respondents want to be full-time remote employees post-pandemic, while 39% want a hybrid work environment.
In 2022, candidates will increasingly expect flexible, work-from-home (WFH) and hybrid working options as standard when they apply for positions. And the best companies and tech recruitment agencies will have to cater to this need if they want to attract the best talent.
Most tech companies include referral programs in their hiring strategies. According to a TalentLyft study, around half of businesses name employee referrals as their top channel for new hires, with 88% saying that they're the best method for above-average applicants and that referred roles are 55% faster to hire.
of hiring locally:
+ Quicker recruitment process
+ Local employees fit in easier
+ Money saved on relocation and paperwork
+ Best tactic for hiring one or two people
of hiring locally:
− Limited talent pool
− Less diverse team - less creative solutions
− Lack of international experience in recruits (unless they have previously worked abroad)
Predictions for local tech recruitment in 2022:
While the pandemic persists, local recruitment will keep some characteristics of remote and international hiring - like job interviews in video format.
Even local candidates will expect to have remote and hybrid work options.
Most companies will retain physical offices and go back to face-to-face hiring processes as soon as it’s safe. However, some businesses may permanently switch to smaller office spaces for fewer physically present employees.
It’s often simpler to hire local specialists because managers have fewer worries about how they’ll fit in the team practically and culturally. Besides, there is less responsibility on the manager’s side about how the new employee relocates and settles down in the new place.
Maris Tepers, CEO of MateHR
INTERNATIONAL TECH RECRUITMENT: PRESENT SITUATION AND FUTURE TRENDS
Before the COVID-19 crisis, international hiring was on the rise because business owners increasingly realized that access to a much wider candidate pool helps to find highly qualified specialists. However, international hiring slowed down during the first year of the pandemic, with many professionals unwilling to relocate in times of uncertainty.
Today, when the workforce and businesses worldwide have started adapting to living with the virus long-term, international recruiting is making a comeback. Leading IT companies like Zoom, Salesforce, Dell and others hire location-agnostic teams and some are even opening offices in new countries to improve their chances of attracting IT talent.
Local language knowledge requirements are becoming less relevant, with English knowledge dominating as a mandatory universal language.
Despite remote work being on the rise, 2021 showed us that increasingly more specialists are also open to relocating to another country. Project teams are becoming more and more international and multiculturally diverse. We also see the term “contractor” changing its meaning with a growing number of companies using B2B contracts instead of traditional forms of employment. Therefore most project teams are a mix of employees from different countries and employment types (e.g., remote/on-site/hybrid employees, traditional employees and B2B contractors).
WHAT ARE B2B CONTRACTS?
Hiring IT professionals based on B2B contracts is an IT recruitment trend that's becoming more and more prevalent across Europe. A B2B contract entails that an employee is a self-employed person instead of having a traditional employment contract. Such contracts are becoming more and more common in Poland, Romania, Ukraine, etc. Based on data from MateHR IT recruitment agency’s network, the increase in such employment types during the past two years is 300%. B2B contractors usually receive a higher salary but lower social benefits, as the employer does not pay taxes and insurance for them. Recently we see a trend that companies perceive B2B contractors as full-fledged team members, awarding them with different company perks like extra days off, educational budgets, and wellness initiatives (except health insurance).
International recruitment – best solution for hiring IT teams
International recruitment is an especially cost-effective solution for hiring more than a few people and building teams. In many cases, recruiting one employee will take a similar amount of time to hiring three, five, or more people.
For example, when a startup attracts investment, it’s essential to form a team of specialists as quickly as possible. And it’s much quicker and more efficient to hire a team of five, ten, or twenty professionals using international hiring and, most likely, the services of professional tech recruiters.
But even in normal circumstances, hiring a foreign professional and relocating them to your company’s home country takes more time than recruiting locally. In general, if it takes about a month to hire a skilled professional locally, it may take at least two months to go through the process of international recruitment. However, this tactic pays off massively if you are looking to hire a team of specialists, not one or two people.
Best employee retention results
Employee turnover is costly – especially for very specific positions that require in-depth training. Depending on the wage and function, replacing an employee may cost from 16% of annual salary up to 213% of annual salary for highly educated executive positions.
More than a third of the staff turnover rate in the U.S. is due to employees quitting within the first year, and more than half of them quit in the first 180 days. First-year turnover is expensive - employees who leave in the first ninety days deliver little-to-no return on the investment made to hire them.
Even businesses based in big countries sometimes face the problem of a limited candidate pool, especially for highly specialized positions. No single country can compete with the possibilities that a wider region like all Europe or the world can offer. Businesses that seek highly knowledgeable and motivated talents often find that this is very difficult to achieve within the constraints of one country.
Maris Tepers, CEO of MateHR
Internationally recruited employees are less likely to leave within the first year as they have gone through great lengths to secure the job in question. They have completed several hiring stages, filed paperwork for themselves and possibly for their families. And finally, they have made a leap of faith and moved to another country for that particular job. It’s also in your power to reduce the turnover rate by providing assistance to internationally recruited employees, for example, by offering language courses or practical support to their families if they’ve also moved. Think about updating your relocation packages with benefits that address the new post-pandemic time climate.
The long-term observations from our tech recruiter network demonstrate that relocated employees are much less likely to change their job than locally hired employees. This may also be because such specialists are often vetted much more thoroughly than locally or remotely hired workers.
Maris Tepers, CEO of MateHR
EMPLOYEE BENEFITS AND RELOCATION PACKAGES IN 2022
2021 showed that employers are actively adding to the contents of their employee benefits packages, thus improving the competitiveness of their offers on the job market. Besides flexible work hours and the option to work remotely or on a hybrid basis, in 2022 IT professionals can expect to be offered these perks:
Extra days off and/or shorter work hours on Friday
Improved mental health support
Improved approach to parental leave
Training and education opportunities
B2B contractors can expect to have equal benefits to traditional employees, including extra days off and educational budgets (except health insurance)
Career growth opportunities
A growing number of companies have started offering company shares or restricted stock units (RSU) as a form of compensation to their employees
Access to local and international IT conferences
The pandemic has also brought significant changes to relocation packages, aiming to give candidates an extra safety pillow as they’re making this important step in their life. Most notably, companies increasingly offer life insurance for the candidate and family health insurance (spouse and kids included). In addition, many employers offer local language courses both for the employee and their family members if they’ve also moved.
Support to the candidate’s family has always been an important factor for candidates who move to another country for a job, so forward-thinking employers should consider adding these perks to their relocation packages.
of hiring internationally:
+ Access to a global talent pool
+ Higher employee retention rate
+ Higher employee motivation and efficiency
+ The best recruitment tactic for forming new teams quickly
+ More diverse teams are better at problem solving and creativity
of hiring internationally:
− In some cases, more expensive than remote and local recruitment
− Takes more time than remote and local recruitment (if you want to hire one or two people)
Predictions for international tech recruitment in 2022:
International recruitment will continue equalizing IT specialist pay across the world.
More employers will realize that having a diverse workforce (in terms of employee culture, race, background, and other factors) is good for business and include diversity in company corporate strategies.
VR will be used for realistic job previews in a remote hiring environment. For example, virtual tours of the office can give candidates a better feel of the office environment and help them understand if they’ll fit in.
A growing number of companies will begin offering an opportunity to start working from the candidate’s home country and relocate later.
The battle for the best IT talent has urged companies to accommodate more and more needs of candidates who relocate. Currently, relocation packages seem to have everything required for a successful move to another country, including consultations, family insurance, paid transport and accommodation for the first month, and assistance in finding permanent housing. It seems that the bonuses here are close to reaching the limit, but with time employers might come up with new ways to attract much-needed tech talent. For example, companies might start offering initial remote work with relocation after a few months if a good fit is established on both sides.
Maris Tepers, CEO of MateHR
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: