Employers have to accept that staff mobility is part of the new economy, writes Niall Kitson.
According to a survey from US jobs website Glassdoor.com, an intern software engineer at Facebook can make an annual salary of $74,700 pro-rata ($6,225 a month). Full-time engineers start at $111,452. It’s startling but not unique among the tech giants in Silicon Valley. Interns in Google, Microsoft, Intel and Cisco can expect a monthly income of $4,000 to $6,800.
Time was - and mostly still is - interns worked for free but it’s not just the pay packets that have changed, hiring models are too. On top of traditional hiring and headhunting - ‘poaching’ if you want to get personal about it - companies like Yahoo have adopted an aggressive strategy of ‘acqui-hires’ where small companies are bought up for their talent, not their product, which is often discontinued. Obliterate, not integrate, if you will.
Such is the skills gap that college graduates are being courted with massive wage packets, time to pursue personal projects and all manner of perks. This is why Google’s offices come with free food, drinks and places to sleep; Yammer’s global headquarters lets its staff bring their dogs to work; Etsy’s office looks like a craft fair; and ping pong tables are de rigeur. Ruthlessness can pay when it comes to getting developers in the door, being fun is the only way to keep them.
In Ireland, the wage packets are smaller but the problem is the same - many would say worse. The digital divide separating the tech savvy from the rest of the workforce is being acutely felt as multinationals struggle to find candidates with coding and language skills. A recent report in the Irish Times estimated that universities are producing only half the number of computer science graduates the economy needs and that the current shortfall of suitably qualified graduates runs at about 5,000. At a time when unemployment hovers at 14.6% it's obscene that the driving force behind Ireland’s economic recovery be so poorly served. There are only so many times the word ‘innovation’ can be bandied about before it becomes code for ‘unlikely to help the average jobseeker’.
One solution proposed by SOS Ventures entrepreneur Bill Liao at the Global Technology Leaders Summit in Cork this week is to look abroad for help with the introduction of a working visa specifically for tech workers. The suggestion was based on Liao’s 18-month struggle to secure a visa, despite his work history as an employer and intent to set up a business here. As a member of the EU, an entity founded on the principle of free movement of ideas, goods and services across borders, the State has some questions to answer about its less-than-streamlined process (as a side note, the challenges faced by the education sector require separate attention and have been addressed elsewhere in this column).
It’s not like the problem and solution to the knowledge economy’s ills are to be found with a purely international or State-sponsored approach, however. Domestic employers are intrinsic to solving the crisis from the ground up. A recent survey from Accenture carried out by Amarach confirms that if you can code or sell you won't have trouble finding a job but employers are cagey when it comes to developing talent lest workers move on to bigger companies offering better packages. Who wants to be a feeder company to Google?
It's a bizarre situation. Companies need skilled workers, colleges and the State are too slow to provide it yet employees fear training staff out of their jobs. This has created a new kind of glass ceiling preventing staff from developing the kind of leadership and management skills necessary to grow a successful operation. The mantra of 'doing more with less' that has dogged Irish culture in recent years is in danger of becoming an excuse to stifle the knowledge economy and accept mediocrity where excellence is demanded. It's as if employers are waiting on a revolving door of interns and entry-level candidates looking to get their foot on the ladder before moving on to more lucrative positions. A quick browse through the website of government-funded intern scheme Jobbridge would indicate it’s already swinging away.
Accenture's statistics seem to bear this thesis out. Of the 100 large and medium size companies and 1,000 people surveyed, 73% said they needed more employees with business and management skills versus 32% of workers who claimed to be qualified in them; and 56% of businesses said they were looking for candidates with IT skills, compared to 32% of candidates who said they were suitably qualified in them. Worse still, 49% of businesses said they would require people with experience in science, education and maths in the next three years, versus only 14% of candidates with suitable qualifications. When it came to staff retention, 37% of employers said it was currently a problem but 57% admitted it would become one in the next three years.
Irish employers can't be expected to provide Facebook intern-level wages and incentives but they can retain and develop talent by creating vibrant workplace cultures - no ping pong tables required - so long as there is an emphasis on engaging projects and personal development. Oddly enough many businesses seem to have training budgets set aside, but haven't communicated it. 71% of businesses in the Accenture survey said they have a budget for training set aside, but only 45% of workers said there were unaware of any learning or development programmes.
The lessons from this survey are clear. The Knowledge Economy requires employers to engage with and invest in staff, preferably with a combination of interesting projects, the opportunity to further their skills and to be paid appropriately for using them. It's not a new idea but knowledge workers are more expensive, crave creativity and are more mobile. Employers may not like being put on the back foot like this but unless they accept the reality of staff mobility lest Ireland Inc will be left behind.
As a parting thought, PR agency Edelman has just released its annual trust index. That financial services and government retain their positions as the least trusted sectors in Irish society is no surprise, what is, is the degree of faith in the tech sector. Almost two thirds of the population (64%) said they believe in the potential of the Knowledge Economy and see it as more competent and less corrupt than the main pillars of society. This optimism cannot be tainted by cynicism, lack of investment and the fear of mobility. It’s bad for business.
Niall Kitson is editor of TechCentral.ie