The received wisdom is that Australia is suffering from an ICT skills shortage. Last month we established that the problem wasn’t a lack of skills in general, rather that specific technical skills are in short supply from time to time, and that there’s also a shortage of people that combine technical skills with people and organisational skills and business knowledge. So, what can we do about it?
Two aspects need to be addressed: attracting the right people into the industry, and ensuring existing workers are re-equipped to meet contemporary skills requirements.
New blood
Demand for places for tertiary IT courses at Australian universities fell after the dot-com bubble burst over a decade ago. “The ACS maintains there are not enough students choosing ICT as a career in Australia and domestic supply is not keeping up with demand,” said Australian Computer Society CEO Alan Patterson. “More focus is needed on attracting students to ICT as a rewarding and exciting career.”
Professor Chris Pilgrim, Deputy Dean of the Faculty of Information and Communications Technology at Swinburne University of Technology, said the number of students entering ICT courses in Victoria is still declining - it fell a further 6% this year - but preferences for Swinburne courses were up in what he described as “a very complex situation”.
Until the tech wreck, university IT courses attracted high-quality candidates. While Swinburne saw some applicants with ATARs (Australian tertiary admission ranks) over 90, the proportion was still well down compared with the situation 10 years ago. Yet employers want high-quality recruits.
Pilgrim suggested the image of ICT careers needs improvement. It’s not just for geeks, as interpersonal skills are needed, he said. Part of the problem is that ICT has become pervasive and taken for granted by school students, who are by and large interested in the products but not the technology itself: “It’s a consumer-oriented world.”
Bruce Craig, Country Manager at Micro Focus, goes even further: “[The widespread use of] PCs in schools was a disaster for the industry” as it resulted in a generation that equates working in IT with being a front-line break/fix technician, with no exposure to the satisfaction that comes from creating software.
SAP tries to foster interest in ICT careers through a school IT competition run in conjunction with the University of Queensland. “It’s a great way for the children to gain an understanding of the possibilities of IT,” said Karsten Shulz, SAP Vice President Research, as well as providing an opportunity to meet IT professionals.
And a spokesperson for Andrew Stoner, the Deputy Premier of New South Wales, said the state government “strongly encourages skills development and has supported NSW university programs to attract school children into technology careers. One such example is our current support for the National Computer Science School run by the University of Sydney.”
At the other end of the pipeline, demand for Swinburne ICT graduates exceeds the supply. One of the reasons for this, Pilgrim suggested, is the university’s emphasis on industry-based learning, with around 50% of ICT students taking up the option of an industry placement after their first two years of coursework. Last year, 110 students went on placements, with another 70 involved in internships. “We’re very selective [about the partner organisations],” he said, explaining that they must respect students and treat the exercise as a learning experience.
Students benefit from this real-world experience, and employers use it as a way of finding new talent on a “try before you buy” basis. Around half of the students are subsequently hired by the organisation they worked with.
SAP runs an internship program with Australian universities, Shulz said, providing students with opportunities to spend between six weeks and a year at the company’s Brisbane or Sydney centres. There’s also an industry PhD program that allows researchers to spend 5% of their time with the company.
Stoner’s spokesperson pointed out NICTA, Australia’s largest dedicated ICT R&D institute, has supported over 130 NSW PhD students to graduate with both high technical skills and commercial orientation. “NICTA has also partnered with the Australian Computer Society (ACS) to create the Young Aus-Innovators National ICT Prize, launched in 2009 to encourage high school students to consider careers in ICT.”
Duncan Brown, Director of Services at Dimension Data, believes organisations should provide students - not just those studying IT - with career counselling and more opportunities for part-time and vacation work to give them a realistic view of the industry.
More university IT courses should include business and management content, said UXC Consulting CEO Nick Mescher, because understanding how business actually works is important as the days of an IT career spent sitting in a back office are over, at least in the commercial sector.
BT Australasia recently began hiring new graduates and is “pleasantly surprised by the quality of people coming out of Australian universities”, said Managing Director Paul Migliorini, describing them as the best the BT group has seen in Asia, largely because they have been taught how to think.
The Infosys spokesperson was less positive. The company has been generally pleased with the results of an experiment with graduate recruitment, but a relatively high proportion of local hires failed to successfully complete their training at the company’s Mysore (India) campus.
The TAFE sector came in for some criticism. Filip Banovac, Country Service Manager, Pacific at APC by Schneider Electric, suggested the colleges aren’t doing as much as they could and called for a national approach.
The changing nature of the issues facing IT can also contribute to the attractiveness of careers in the sector. For example, Andrew Kirker, Sales Director, Pacific at APC by Schneider Electric, noted that the increased awareness of the need for energy management (‘green IT’) has helped APC attract and retain good staff.
Lifelong training and development
Brown suggested enough people enter the industry, but excessive churn occurs as they struggle for opportunities to maintain their certifications and gain increasingly diverse experience. Some organisations are too small to provide that diversity, so outsourcing may work to employees’ advantage, providing they can transfer to the outsourcer on reasonable terms or find a job with a comparable organisation.
Employers must invest in their staff in terms of achieving and maintaining certifications, he said, describing it as “a critical part of our [Dimension Data’s] intellectual property”. To that end, the company works with certain vendors to ensure that courses are available within Australia so people don’t need to travel to Singapore or further afield to keep up to date.
IT workers aren’t just relying on formal training and certifications to prove their worth, noted David Jackman, Managing Director, Pronto Software. Participation in open source projects demonstrates technical skills and good attitudes to potential employers.
Ian Hodge, Managing Director ANZ at Quest Software, observed that jobs involving lower-level skills are the easiest to offshore, while organisations prefer to keep the higher-level work in the country. Migliorini said “that’s not necessarily a bad thing” for workers as it means more interesting local jobs. Furthermore, he said there is the need for commercial thinking, knowledge of organisational culture, process reengineering and so on in order to deliver a mature outcome, and (unlike most of the people we talked to) he believes there are plenty of people in Australia with those skills. He also observed that Australia is a leader in IT as a management discipline, pointing to the high proportion of Australians among regional IT executives.
Despite the general fear of losing people to other employers after training them, Hodge says retention issues can be addressed by providing the right environment and culture. Banovac agrees: “A happy employee will never leave”, making the investment in training worthwhile. Schneider Electric has no turnover problems, he claimed, but the company does provide career paths - “That’s one of the differences with Schneider.”
Lisa Christy, SAP’s Human Resources Director for ANZ, questioned whether smaller companies have either the resources or mindset of multinationals when it comes to training, development and career progression. On-the-job coaching and working in client-facing roles is important, she suggested, but smaller organisations tend to have a less mature attitude that focuses on formal training. “I’m not sure employers realise the opportunities.” Banovac argued that a lack of size needn’t be a barrier to providing staff with opportunities for development and progression. “It’s about strategy rather than size,” he said.
Local systems integrators experience high attrition rates if employees discover they can earn more as contractors, said Hodge, and some organisations prefer to arrange their own team of contractors instead of engaging an SI or other provider. Hence concerns that money spent on training could be wasted.
Dimension Data isn’t the only company to take seriously the need to maintain their workers’ skills. Shulz said SAP offers thousands of online, on-demand training courses to its staff as well as classroom training.
Banovac said “there is an ICT skills shortage” that started a couple of years ago, and Schneider Electric has been running a training program called Encompass that takes new hires with trade qualifications through its business to give them “a clear and defined career [skill] set” that the company needs.
Mescher believes organisations have in general been investing less in education and training since the GFC, and this has “unintentionally deskilled the workforce”, opening the door to further offshoring.
Local skills are needed for successful project delivery unless entire functions are moved overseas; but with the disappearance of many lower-level jobs, how will the future generation of managers gain the background experience they will need to do a good job? Mescher says we have to accept that the paradigm has changed and equip people for these roles through management training, coaching and mentoring. Individuals will be increasingly drawn from a wide range of IT-literate disciplines to fill roles in project management, vendor management and so on.
Migliorini is of a similar opinion, suggesting people with backgrounds in healthcare, finance, etc will be given IT training to allow them to fill the higher-level jobs left by outsourcing. Rachel Lehmann, Human Resources Manager at MYOB, said her company (which keeps the majority of roles in-house and onshore) uses a similar strategy, including the use of pair programming to advance the skills of its development staff.
Applying technology
Craig sees technology as an important part of addressing the COBOL skills shortage. “The demand of skills remains very high but you have a diminishing workforce.” In general, COBOL programmers are ageing, so employers are trying to tempt specialists out of retirement with attractive contracts and sponsoring university COBOL courses. Even where banks are downsizing their IT operations, COBOL teams remain untouched. “I don’t know the last time I heard of a COBOL guy being made redundant,” he said.
Tools like those from Micro Focus make existing COBOL developers more productive and make it easier to cross-skill others with experience using Visual Studio or Eclipse-style tools to work on COBOL projects. Most COBOL applications are mission critical, so experience counts.
Where operational skills are in short supply, Hodge suggests automation can be brought to bear in some situations and is a viable alternative to offshoring. But shortages of softer skills cannot be met this way and so he expects continued hiring from overseas.
Imported talent
Hodge pointed to the Regional Sponsored Migration Scheme for skilled migration that provides permanent residence for people moving to certain areas (including Perth) to take up jobs that cannot be filled locally, but Hodge observed that large organisations are proving slow to take advantage of these arrangements.
Dimension Data has made an effort to get into a position where it can obtain, relatively quickly, the sometimes-controversial 457 visas for overseas workers, and its multinational nature makes it easier to recruit from Europe and North America. This is “quite an effective scheme”, said Brown.
Infosys is another company that uses a large number of 457 visas to make up for local skills shortages and in some cases the absence of niche skills, “but that isn’t easy” as Australia is in competition with countries where marginal income tax rates are lower, the spokesperson said, adding that the possible removal of the living away from home tax allowance “is a great concern to our clients” and could result in more offshoring.
Diversity
One relatively longstanding approach to enlarging the ICT workforce has been to encourage the entry of women. Shulz noted that girls make up 46% of participants in the schools IT competition but just 15% of IT graduates.
Jackson noted that women working part-time at Pronto are generally previous full-timers that want or need to reduce their hours for a time. Like Brown, he believes some of the company’s IP lives in employees’ heads, so works to maximise the chance of retaining staff during and after parental leave. A bigger issue, he believes, is getting women in IT to move into management roles - “It’s not always on their roadmaps,” he observed.
An IT career can provide the flexibility that Generations X and Y seem to expect, through practices such as BYOD and considerable freedom regarding working hours and location as long as the required results are achieved, said Brown. This also benefits people who want or need to spend more time at home, or who wish to live in rural or semirural areas.
Real workplace flexibility appeals to workers of all ages. Christy suggested the industry needs to attract and retain older workers, and part-time positions and remote working can help achieve that goal.
Would it help if mature-aged workers in declining sectors were encouraged to make a career switch to IT? The Infosys spokesperson said their stability makes them attractive to employers that invest in training, but candidates would need to be prepared to start on lower salaries and to put in the effort needed to establish a new career. Testing is a possible entry point for older newcomers, especially if they have domain experience (eg, banking) that was relevant to the employer.
Some older IT people (employed or unemployed) report age discrimination is a problem, but the ACS’s employment surveys suggest it is becoming less common. In 2010, 13.1% of respondents said they had encountered age discrimination, down from 20% in 2009. Yet “it is still a very real issue”, said Patterson: the surveys show the majority of unemployed IT professionals are 45 and over.
The ACS acknowledges there are many reasons for age discrimination, but the perception that older workers lack current skills is confounded by the fact that training rates are highest among the 45-54 cohort. Employer-sponsored training of workers aged 55-64 drops off significantly, even though most of them won’t be retiring for several years or more.
