Tech job growth continued for a second month in a row, returning to near pre-COVID-19 levels. And while the shift to remote or work from home (WFH) roles is a contributor, it’s certainly not the only one.
Tech companies added 19,500 new jobs in January 2021 per the “The Employment Situation” or “Jobs Report” from the U.S. Bureau of Labor Statistics. The tech sector, one of the few to show gains, now employs nearly 4.7 million — a decrease from its pre-pandemic high but still higher than March 2019 (4.65 million). Additional IT growth — more than 78,000 positions — came from tech jobs outside the sector (aka “occupation” roles in finance, insurance, manufacturing). Job postings also rose slightly in January to 207,000, led by software/application development listings of nearly 63,000. Tech’s January gains shined against the backdrop: 140,000 jobs lost from the U.S. economy overall.
“The latest tech job figures signal a continuation of hiring momentum with contributions in both expected and unexpected employment categories,” said Tim Herbert, EVP of Research & Market Intelligence at CompTIA, a global IT association. “On the occupation side, the data confirms the multi-faceted nature of employer tech talent needs with demand spanning software, artificial intelligence, infrastructure, IT support, security and more.”
Notable category strengths
The unexpected occupation growth Herbert refers to included IT jobs in telecom.
“That category was a pleasant surprise,” Herbert said. “January was the first time we’ve seen telecom job growth at that level since mid 2017. The next one to two years could reflect telecom growth beyond traditional consumer services into 5G, cloud and cybersecurity.”
There were several other strong industries for tech based on job postings: professional, scientific and technical; finance and insurance; manufacturing; and information.
Select tech jobs rank high for remote
A group of specific job categories led in both the tech sector and tech occupations: software; IT support; systems engineers, architects and analysts; and IT project managers.
“The largest categories have rebounded,” CompTIA’s Herbert said, “including renewed growth from IT positions that tend to support businesses through channel and managed services.”
In CompTIA’s January report based on the federal jobs data, the tech jobs in highest demand and those with the most WFH job postings in the nation’s leading geographic tech markets were nearly identical: software; IT support; IT project managers; and systems engineers/architects/analysts lead both data sets.
This mirrors 2020 trends reported by Hays, a global staffing leader, and follows the trajectory of need COVID-19 created by shifting workforces home almost overnight. This includes those who can facilitate and make remote work secure to those who can support long-term remote solutions. Hays adds cybersecurity, IT project managers and change experts to its high-demand tech positions last year.
But what’s the role of WFH in this growth?
Remote work for IT professionals seems like a natural fit. They’re outfitting the rest of us to work from home, so wouldn’t they be included? Gartner identifies “anywhere operations” as one of nine top strategic technology trends for 2021, including a “digital-first, remote-first” model that must not only support, but engage end users: employees and customers alike.
Companies of all sizes will drive the change, but in May 2020, some big names made a splash. Facebook announced that it would offer permanent WFH status at lower salaries to current employees and to select applicants, including those from more diverse geographies. Other companies followed suit — Twitter, REI, Shopify — with many implementing what the tea leaves already suggested.
Jennifer Christie, Twitter’s HR chief, said, “We’ve already been on this path, and the crisis just catapulted us into a future state.”
More tech jobs in markets with lower costs of living could drive more companies to scale down salaries and, in the long run, boost overall hiring with the lower overhead. It’s simply cheaper to live in the Ohio Valley than Silicon Valley — with more savings for everyone now that getting to work is measured in steps, not miles.
This is confirmed by tech occupation salary data from ThinkWhy Chief Innovation Officer and SVP of Business Intelligence Jay Denton. The company’s LaborIQ talent acquisition analytics platform shows a nearly $50,000 recommended salary difference for a software development company engineer in San Francisco ($159,000) and one in Indianapolis ($110,000).
“The data and recent interviews with Silicon Valley COOs show that companies are looking to other markets for remote talent,” Denton said. “Employers recognized even before COVID that they had to offer something beyond benefits to secure top talent.”
But which markets will see the biggest gains? Cost of living and tech salaries are lower in the South, making it a strong candidate for growth. But Denton reports that more workers below the Mason-Dixon line are heading back to physical offices, which could make the Midwest and Northeast future leaders for WFH tech hiring.
Tech was already strong
There’s no doubt WFH is an important dimension of the tech jobs picture. While national remote listings were 7 percent for all occupations in 2020, it was 22 percent for tech occupations – three times higher and a jump from 15 percent in 2019. Anyway you look at it, those numbers signal a tech workforce that will be increasingly remote.
We can’t forget, however, that tech was already strong. CompTIA’s Herbert put hiring in the sector in perspective.
“These strong directionals really started pre-COVID,” Herbert said. “Tech strength is roughly back to those levels, and we can feel generally good about the trend. Hiring intent from industry sources is there, and tech has been a remarkably stable contributor to job growth over the past 20 years. The last time tech had a really bad year was 2008.”
And that was a bad year for everyone.
Tech market strength also comes from unemployment rates, which were at a historical low as far back as the fall of 2019. Denton agrees, noting that tech jobs were already competitive and that more workers chose to stay put in 2020 due to COVID-19.
It’s all in the wiring
With remote listings for tech occupations outpacing other categories, it appears IT professionals are wired for WHF. But what about the rest of the U.S. labor market? Two-thirds of surveyed HR professionals expect remote work to be permanent to some degree depending on the occupation, company and industry – this from CompTIA’s “Workforce and Learning Trends 2021” report set to publish in March. The prognosis will emerge as more people receive the COVID-19 vaccine.
For some, Zoom meetings are a welcome change. For others, they can never replace the impromptu conversations that happen in the hallway, the breakroom or at the water cooler. But all humans are wired for some degree of social interaction. And there are broader implications for the dynamics of the entire U.S. labor market.
“If remote work becomes more permanent, there are issues of not only long-term tech resource support and cybersecurity, but social policy implications, like digital divides,” Herbert said.
Continue to watch this space for more news on remote work 2.0.