UK tech growth hindered by skills shortage, reveals Morgan McKinley

The UK's tech growth is being challenged by a significant shortage of suitably skilled candidates, according to reports from global agency, Morgan McKinley. The company's 2024 Salary Guide highlights that 25% of UK hiring managers in the technology sector view this shortage as their primary hindrance for the year.

The Guide, based on research carried out in 2023, revealed that 76% of tech hiring managers described the recruitment landscape as 'very' or 'quite' competitive. Among other challenges, managers listed difficulties in competing on pay and benefits (22%), as well as issues in securing approval for new headcounts (19%).

However, positive signs exist for the sector in 2024. Half of the tech hiring managers intend to expand their team in the first half of this year, with 46% of tech professionals also seeking new roles during this period. Moreover, a further 31% are considering a move.

The research further indicated that nearly half (46%) of tech professionals experienced feelings of indifference or insecurity in their previous roles. Nevertheless, 75% chose to remain in their current positions over the last year, suggesting concerns over job security.

The Guide found that when contemplating a job move, tech professionals' main considerations are a higher salary (40%), followed by opportunities for career growth and development (14%) and the ability to work remotely (13%). Notably, work-from-home and flexible working hours were amongst the top benefits of tech professionals (71%).

Regarding office presence, 42% of tech professionals indicated a preference for being in the office 1-2 days a week, whereas 8% preferred a full 5-day week on-site. More than half (53%) said they would forfeit a pay rise to achieve their desired flexibility. Simultaneously, hard-to-fill roles are expected to witness an increase in salary offers by 69% of employers, with 20% planning a salary hike across all technology teams.

Kieran Scully, Senior Manager of Technology Recruitment at Morgan McKinley UK, noted that the most sought-after fields in 2024 would be Data, AI, Cyber and Cloud. He said: "The hot new trends and the demand for talent are around Artificial Intelligence and Machine Learning, where most companies continue to struggle with a shortage of skilled talent."

He added that the high demand coupled with a scarcity of skilled professionals would intensify competition for talent, leading to salary increases. He added: "The shortage of talent in some markets will see salaries continually increase, particularly across the areas mentioned earlier, while we expect them to stabilise more in Software Development."

Morgan McKinley's 2024 Salary Guide offers updated salary data for a broad spectrum of technology roles across the UK. It is based on research from 650 businesses and 3,400 professionals aimed at understanding companies' hiring intentions, key motivators for changing jobs, and expectations for salary adjustments in 2024.