Threat of recession prompts tech leaders to increase spend on tech L&D

New research from O’Reilly, the premier source for insight-driven learning on technology and business, has revealed that cybersecurity talent is the digital skill most in demand for 24% of technology companies. Yet, around a third of all HR decision makers in the tech sector are willing to spend more than £10,000 on recruitment (31%) and L&D (37%) to boost cybersecurity talent.  

The research – conducted in September 2022 by Censuswide, surveyed 300 HR decision makers in the tech, finance and ecommerce/retail industries (100 per industry) – revealed that more than half (57%) of HR leaders in the tech sector feel significantly supported by their leadership team to invest in tech-related L&D, signalling the sector’s growing concern around the widening digital skills gaps. In fact, the majority (89%) of tech respondents confirmed their organisation would increase spend on tech L&D with a UK recession looming.

Recruitment and L&D spend not aligned with skills most lacking

The research highlights that demand for digitally skilled workers within the UK’s technology sector is outgrowing the level of digital skills available. Within the technology sector, nearly a quarter (24%) of the HR leaders surveyed said cybersecurity talent is most in demand, followed by software architecture (17%) and Artificial Intelligence (AI) and Machine Learning (ML) (16%). Despite this, only a limited number of companies are willing to spend more than £10,000 on recruitment (31%) and L&D (37%) to hire cybersecurity talent in the next twelve months.

Meanwhile, the majority of companies within the technology sector plan to spend no more than £10,000 on recruitment (70%) or L&D (72%) to bolster software architecture skills. Furthermore, companies will spend no more than £10,000 on recruitment (65%) or L&D (69%) for AI and ML talent.

Disparity in recruitment vs L&D spend

Encouraging, of the industries surveyed, the technology sector is planning to spend the most on overall recruitment for tech skilled vacancies, with the majority (88%) of organisations surveyed planning to spend more than £25,000 in the next twelve months to fill crucial roles. Yet only 80% will spend the same amount on tech-related L&D. In fact, the technology sector will spend an average of £33,676 on recruitment compared to £31,651 on L&D. The biggest barrier to upskilling current employees for a fifth (22%) of technology companies is insufficient resources, followed by a lack of leadership support (21%).

“Despite the impact of the pandemic, the UK’s technology sector has continued to grow, with Britain now home to a booming number of unicorn startups as well as global technology giants,” said Alexia Pedersen, VP of EMEA at O’Reilly. “Yet, the Government’s Digital Strategy document published earlier this year revealed the true extent of the UK’s digital skills gap, which is estimated to cost the economy over £60 billion per year.

“With more than half of tech workers currently considering a career change, British tech companies must increase investment in L&D to both retain and recruit the brightest tech talent. The digital skills gap will not be closed through recruitment alone, so now is the time for tech companies to invest in their employees and deploy upskilling programmes, which will be vital to bolster innovation and safeguard the UK’s position as a global tech powerhouse.”