Hiring and Retaining Software Engineers in Ireland: Exploring the Current Landscape – Part 1

It’s no secret that Ireland, specifically Dublin, is one of Europe’s biggest tech hubs, and for good reason. However even with the recent downturn there is still a severe shortage of technical skills causing a problematic talent gap in Ireland. A survey by Expleo in 2023 revealed that 94% of Irish businesses struggled to find the right hires for IT roles with 74% of business leaders reporting that Ireland is struggling to attract the top talent (5). The most worrying part of their survey shows that 70% of hiring managers are concerned about the potential detrimental effect on future business strategies. So despite the abundance of the technology workforce here in Ireland, the numbers still don’t add up. We have a lot of professionals, but we have a lot of jobs to fill too. 

What does this mean for employers? 

The talent shortage creates a massive demand for top talent and will force employers to go head to head to hire. In such a candidate driven marketplace, it’s essential for an employer to get it right from the get go, the attraction stage. First impressions count. When a candidate has multiple processes ongoing, it’s easy to discard those that took too long to initially respond, didn’t take the time to answer any preliminary questions or who’s job specification or application process seems unrealistic. A silkroad survey found that 68% of employees believe their experience as a candidate reflects how a company will treat them (6). A similar survey by clutch shows that 35% of candidates think it’s unreasonable for a company to not respond to their application and 52% abandon between 1-5 applications during their search (7). This really echoes the need for companies to get their candidate attraction piece correct, straight from the get go which is generally posting the job advertisement. 

Securing the talent is only half the battle

So the hire has been successfully made – good news? Unfortunately not all of the time, attracting and hiring candidates is half the battle with retention being the other half. 

The technology scene in Ireland is quite fluid with a lot of turnover, according to LinkedIn the average turnover in Tech and Media was 12.9% in 2021/2022 which is above the all industries average of 10.6% (8). Looking at LinkedIn Insights there are around 31,219 Software Developers/Engineers in Ireland currently with an average tenure of 1.5 years (9). This is quite a short employment length for a permanent role, but seems to be the norm in development roles. With it being a candidate driven marketplace, the candidates are in control. The average IT professional received twice as many LinkedIn inmails as the average user and Software Developers get 2.5 times as many (10). When an IT professional is disgruntled with something in their current role, they likely are receiving a multitude of other offers in the background, making the decision to move roles again an easier one. 

Why are they moving? 

A survey by Iconiq found that dissatisfaction with their role (83%), professional development and career advancements (78%) were two of the biggest reasons why technology employees leave roles (11).  With the speed of how fast technology changes, if organisations don’t invest to keep up, they may find themselves losing technical staff to competitors. Being “behind” technically can cause technical professionals to become concerned about their future employability and essentially their professional and career advancements. The same survey found that 75% reported leaving for compensation purposes (11). While staying with your current employer for another year could yield a payrise of 2-5%, making a jump to a new employer often see’s candidates salaries increase by anywhere from €5000-20,000 making it a much more lucrative choice. Linked in has reported 93% of organisations are concerned about candidate retention (12)

Why does it matter? 

High turnover is more than a statistic, it’s a catalyst for a series of consequences. With a high turnover, it’s much more difficult to make workplace friendships. A lack of workplace friendships can lead to employee loneliness which can in turn feed into a lower team morale and feeling of disconnect with the business which can in turn, fuel more turnover (14). 

With the average time to hire a software developer being around 35 days, when one leaves, you can imagine the effect on projects due to a loss of efficiency. The loss of a team member also puts additional pressure on the remaining team members which in turn can lower their morale (15). 

Additionally there is a cost to an unsuccessful hire, and it’s been estimated to be around 33% of their annual salary (16). You can imagine how quickly this could add up for companies with poor culture, changing landscapes etc that may be likely to experience high turnover. 

As we can see, Ireland’s tech scene is booming but isn’t without it’s issues. Employers will need to put their best foot forward at every stage in order to both attract and retain the top talent in the market. Inability to do so will likely lead to employee unhappiness, costly high turnover and potentially negatively affect project delivery. 

Stay tuned for our second installment of our series on hiring and retaining software engineers in Ireland where we give hiring managers some tips to consider to hold on to their team directly from the software developers mouth.

References:

(1)https://www.nathantrust.com/insights/ireland-is-the-number-1-destination-for-us-tech-firms

(2)https://www.idaireland.com/explore-your-sector/business-sectors/technology/

(3) https://codesubmit.io/blog/shortage-of-developers/

(4) https://www.modis.com/en-us/resources/job-seekers/disruptive-shifts-in-tech-engineering-hiring/

(5) https://expleo.com/global/en/insights/whitepapers/business-transformation-index-2023-ireland-report/

(6) https://silkroadtechnology.com/news/job-seekers-are-now-in-the-drivers-seat/

(7) https://clutch.co/hr/resources/what-causes-workplace-ghosting

(8) https://www.linkedin.com/business/talent/blog/talent-strategy/industries-with-the-highest-turnover-rates

(9) – LinkedIn Insights

(10) https://business.linkedin.com/content/dam/me/learning/en-us/pdfs/lil-guide-attract-retain-top-tech-talent.pdf

(11) https://www.datocms-assets.com/65181/1655462190-iconiq-analytics-insights-future-of-work-series-introduction-1.pdf

(12) https://learning.linkedin.com/content/dam/me/learning/en-us/pdfs/workplace-learning-report/LinkedIn-Learning_Workplace-Learning-Report-2023-EN.pdf

(13) https://www.dol.gov/general/topic/statistics/employment

(14) https://journals.aom.org/doi/10.5465/ambpp.2011.65869714

(15) https://research.glassdoor.com/site-us/wp-content/uploads/sites/2/2015/06/why-is-hiring-taking-longer.pdf(16) https://cdn2.hubspot.net/hubfs/478187/2017%20Retention%20Report%20Campaign/Work%20Institute%202017%20-Retention%20Report.pdf