Human Resources and Technology

West Michigan faces talent crunch in IT

Senior technical recruiter says area companies are hesitant to make pay jump for professionals.

December 23, 2016
| By Pat Evans |
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Grand Rapids is running into a talent crunch when it comes to hiring in technology-related jobs in all industries.

Holland-based Paragon Recruiting released its Winter and Spring 2017 Technology Employment Forecast this month and found 52 percent of respondents listed a need for IT personnel. The forecast is performed twice a year by surveying a variety of West Michigan companies and has been implemented for 15 years, Paragon Chief Recruiting Officer Beth DeWilde said.

DeWilde said although the survey is relatively unscientific, the firm has seen ups and downs the past 15 years, and it’s often reflected in the Paragon’s business of placing technology employees. Companies steadily have been in a hiring phase when it comes to technology since June 2014, the last time Paragon saw a “limited decrease” in staffing from respondents.

The staffing increases are running into some trouble, DeWilde said. Among the most challenging factors for West Michigan is pay.

Most companies are looking for mid- to senior-level experience to fill a role with little to no supervision but are wary of paying more to get them, DeWilde said.

Ten years ago, Paragon could place an entry-level technology worker for between $40,000 and $45,000, but that number is between $55,000 and $60,000 today, and companies have been hesitant to make the jump, DeWilde said.

West Michigan companies generally are approximately 10 percent below where they need to be in terms of payment for the professionals, said Jen Bradshaw, senior technical recruiter at Paragon.

“Pay-wise, we’re a little behind,” Bradshaw said. “It’s a struggle with companies, hard to get companies to understand they need to come up with compensations.”

DeWilde said many companies are coming to the realization all wages must come up.

“They’re finding they have to bump the scale up for everyone on staff,” she said. “You can’t bring someone in making a higher scale than the people who have been there a while. This has been a reality check for some companies.”

Salary survey guides now can be “put in the garbage” because they’re off on their salary ranges for junior, mid and senior levels in many industries, not just technology. Paragon’s recent survey found 25 percent of companies are raising IT salaries.

With the lack of salary increases, Bradshaw said many employees see job-hopping as the best way to increase salaries and positions.

The need for technology in all industries has created the shortage of workers, which is national but amplified in West Michigan, DeWilde said. Part of the amplification is companies in other high-tech states are realizing the need to cater to talent.

“More companies are letting people work remotely, so a company in California has a person here in West Michigan making California wages,” Bradshaw said. “That’s how companies are dealing with it, by going where the employees are and letting them work.”

Another piece of the shortage is amplified in how much technology has changed the past decade or two and, as DeWilde said, with no end in sight. Companies now need more than network infrastructure, IT and developers and, instead, need big data and analytic employees, which further dilutes the talent pool by giving interested students more directions to head into while training.

“These pieces are becoming a very big piece of many organizations and the economy,” DeWilde said. “You need more people to do those things, not just development. It gives a broader range of opportunities but takes people away from the other areas.”

Bradshaw said Grand Rapids is becoming known as more of a technology hub with companies and talent coming from larger cities, although it might take time to catch up with enough talent.

“We are a technical city, and it’s getting known,” she said. “The hard part is there’s not a lot of people right now.”

Because of the shortage of workers, Bradshaw said technology workers have been able to demand higher salaries.

“These experienced IT and applications professionals can certainly demand what they want with salaries,” she said. “There are just not the people available and projects need to get done.”

As talent continues to be a major asset and hard to come by, Bradshaw said it’s important for West Michigan companies to consider being flexible for employees.

“The more receptive companies are in finding the right cultural fit in the person, the better,” she said. “Maybe trying to offer a flexible or remote option and thinking outside the box and if someone can work less than full time schedule. Companies are going to have to get more creative in order to retain and attract the talent.”

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