Tech unemployment nears historic lows as hiring grows

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Dive Brief:

• Unemployment among tech professions fell to 1.7% in July, according to a CompTIA review of U.S. Bureau of Labor Statistics data. The number fell one-tenth of a percentage point month-over-month and is close to the all-time low rate of 1.3%, recorded in May 2019.
• Amid job gains in the economy overall, which more than doubled expectations, tech occupations expanded in July, with employers across industries adding an estimated 239,000 positions. The previous month saw the economy shed 17,300 tech positions as hiring cooled.
• Hovering above the historic low by less than half a percentage point, the IT unemployment rate was half of the national average, which was 3.5% in July, according to BLS data.

Dive Insight:

Two consecutive quarters of GDP contraction haven’t kept employers from hiring — particularly struggling to fill tech jobs amid scarcity.

“Despite some of the layoff announcements and some of the other [economic] concerns, it is still an extremely tight labor market for tech talent,” said Tim Herbert, chief research officer at CompTIA.

Software developers and engineers topped the list of in-demand tech positions, with employers looking to fill nearly 148,000 positions in this category during July.

“Tech is now so embedded in businesses that, even when we have periods of economic weakness, it typically does not translate to a pullback in tech hiring,” Herbert said.

With macroeconomic conditions in mind, a handful of big names in technology paused hiring or laid off workers. Google internally announced a two-week pause in July to readdress its hiring strategy. Microsoft cut open jobs in specific groups, while Oracle reportedly began laying off workers in its customer experience division.

“Headlines about increased layoffs have been constantly in the news in recent weeks, but the data from July continue to show depressed rates of job loss,” wrote Nick Bunker, economic research director for North America at the Indeed Hiring Lab in a blog post Friday. “About 1% of employed workers moved into unemployment over the month, which is barely above its June rate.”

Layoff rounds might signal to the market that companies are paying attention to their bottom line amid economic headwinds, said Herbert. Companies “don’t want to be the outlier in announcing that they’re hiring when everyone else is pulling back.”

For employers looking to retain their workforce, addressing company culture and supporting internal training is key.

“Today’s employees want to work for a company whose values align to their own,” Gina Hartigan, chief people officer at Kantata said in an email. “In an industry that is continuously evolving, employees value organizations that keep up with technology advancements and provide opportunities to continue their education.”