- CEO’s Weekly Newsletter
- 10 Jan 2022
The year 2022 is full of possibilities and potential. Whether you are a Recruiter, a Labor Market Economist, or a Workforce Planner, these are exciting times.
Nobel Prize-winning economist and Robert Shiller offered a new way to think about the economy and economic change. Using a rich array of historical examples and data, Shiller argues that studying popular stories that affect individual and collective economic behavior—what he calls “narrative economics”—has the potential to improve our ability to predict vastly, prepare for, and lessen the damage of financial crises, recessions, depressions, and other major economic events.
Observing the labor market through narratives is a compelling way of planning the year. No one knows which narrative will emerge stronger, but we can look at the data and make a reasonable judgment. The one thing Draup believes in is bringing granular data and letting you do arrive at your conclusions. Again, these narratives are meant to trigger your thinking, and hopefully, you will find this useful
Within each domain, specific skills are commanding a premium. Perfecting this model will help organizations narrow down them valuing particular skills instead of a role level premium. For example, when you look at Machine Learning, Deep Learning and NLP skills command a higher wage premium than other skills within Machine Learning. Within Digital Marketing, understanding the market analytics and refining the strategy to improve reach is emerging as a skill that commands a higher premium. For example, deep learning and NLP skills are approximately 15% to 20% higher premiums within the ML domain. Studying each domain and understanding the skills of each domain will be a helpful exercise for any enterprise. This experiment can also inform the reskilling and learning strategy. Many companies do not have this data and are organized mainly by roles. Draup will aim to provide such granular data in 2022.
Kate Clark, a writer who covers Startups, says that the startup industry will witness a record number of high-profile startup implosions stemming from venture capitalists’ accelerated and, at times, lackadaisical approach toward conducting due diligence on their investments. There is no better time than now to create a specialized team of Recruiters to target startups that may fail as many have incredible Engineering and Product Managers talent.
While examining the Taxonomies of jobs available across enterprises, it is evident that organizations do not have enough “pipeline roles.” There is no reason why a Cloud Support Engineer should have four years of minimum experience. Companies are beginning to understand this, and more Early Career roles will emerge.
There is no doubt that companies are tapping global locations for talent for availability, but in the second leg of the pandemic, cost advantage will be the primary consideration. This is because the boards and the institutional investors are pushing aggressively towards the same. And global cost-optimal locations are also going through inflation of different degrees. One Backend Engineer FTE cost in the US may get you 2.5 to 3 FTEs in a location like Bengaluru. Just three years back, the same got you 3.5 to 4 FTEs. This is an approximate comparison and may change on a case-to-case basis. Places like Mexico city can buy you 4 to 5 FTEs in a similar instance (though availability numbers are different, this is provided for comparison purposes)
In 2021, we saw something fascinating. The most popular domain for late 2021 went to TikTok. TikTok essentially dethroned Google and gained the top spot!. This shows the power of Micro Content. With several protocols such as no meeting Fridays and similar trends emerging, we rapidly transition into Asynchronous Communication. Therefore, any new skill and domain training will have to be driven and powered through micro-content. Also, the belief that Skills can be learned through a proper sequence of experience and learning improves. This is what the German automotive supplier ZF Friedrichshafen has recognized. Instead of proceeding with their original plan to lay off several thousands of employees, they have implemented a transformation plan to reskill and redeploy the affected people into entirely new jobs. In recognizing the potential in their employees to transition, this company was able to offer sustainable employment while speeding up the transformation towards e-mobility. Over 30% of the IT workforce in a place like Norway has come through Reskilling as per our analysis. This number is a bit lower in places like in the US and UK, but we believe that these numbers will change
One of the desirable side effects of Cloud Adoption is that IT and Software are converging. We see many people with IT backgrounds transitioning into Software Engineering. If you apply all the filters of Software Product Engineering in the US, there is about 11,000 African American talent. But if you consider IT talent, there is about 495,000!. This sort of dynamics exists across all under-represented demographics. This is almost a breakthrough in this area. But companies do not understand this fully yet. This trend may change in 2022
Data sources are still evolving on how the migration from bigger cities in any given country will lose or gain talent due to the pandemic. A recent Forbes article has disputed some real estate firms’ reports claiming more migration from bigger cities to smaller cities in the US. Such claims and counterclaims will continue to increase. But what is indisputable is that the cloud has democratized city status. Our analysis shows that Tech talent in the US is spread out across 25+ MSAs. In India, tech talent is working across 50 plus smaller hubs. Smaller hubs are emerging in Indonesia, China, Japan, Vietnam, Eastern Europe, and Latin America. Amsterdam is on its way to becoming a large fintech hub displacing London. The term “kid in a candy store” will be applicable for labor market analysis in 2022
If terms like Web3 and Creator Economy are not very familiar in Talent Intelligence world, that will change in 2022. As Recruitment Marketing and the overall Digital Marketing of the Enterprises mature, these are very important concepts to understand. Creator Economic is defined as the class of businesses built by over 50 million independent content creators, curators, and community builders, including social media influencers, bloggers, and videographers, plus the software and finance tools designed to help them grow and monetize. Designing a strategy to work with such a creator economy is critical. Freelance and Gig economy interactions also have to be understood
The US Census released an important report on December 21, 2021. Net international migration (NIM) added 247,000 to the nation’s population between 2020 and 2021, according to US Census Bureau July 1, 2021 population estimates. This is a notable drop from last decade’s high of 1,049,000 between 2015 and 2016. This is also lower than the 477,000 added between 2019 and 2020, which overlapped with the start of the COVID-19 pandemic. This dataset is macro data set and includes all immigration status categories. But a good indicator to study. Covid Shutdowns and various related parameters are the reasons and this trend. We have to watch this in 2022 to see how this will change
Like companies, many governments worldwide are trying to amplify their digital initiatives. From ID-card initiatives to connecting citizens through a digital ecosystem, governments worldwide are creating organizations to ramp up Digital talent. Let us look at Singapore as an example. Their career page asks if you want to build the environment, Shape Society, Keep us secure, and so on. A simple search on tech opens well over 1000 jobs ranging from backend, AI/ML, DevOps. Israel is setting up software shops in Dubai to hire tech talent. Japan is accelerating hiring tech talent across the Globe. Such trends will present more challenges as employees want to work for causes like Net-Zero. It is therefore critical to align the jobs with a solid cause on how employees truly make a difference
Companies across the Globe have understood that current career planning is insufficient. There is a significant need to understand the skills gained throughout an employee’s career and suggest possible movements. Much work is remaining in this space and a critical dataset that Draup can support in 2022