Andy Heyes

As we enter a new year, I don’t think many in the technology recruitment industry will be especially sad to leave 2024 behind. 2024 was quite a challenging year in which continued uncertainties dampened volumes and demand. Economic conditions improved a little, with inflation falling back to normal levels, but interest rates only edged down and, overall, rates of growth remained subdued. Combined with continuing geopolitical instability including the wars in Ukraine and Gaza, and the upheaval of elections in the UK, US and elsewhere, the market lacked the continuity and certainty needed to spur widespread, sustained recruitment activity. Companies were cautious, and candidates tended to favour staying put (and negotiating better terms) rather than risking a move – leading some to describe the year as ‘the great stay’. 2025 – key pockets of activity and growth Heading into 2025, I believe that the market will improve and reach a more stabilised level of demand. The OECD has recently upgraded its economic forecast for the UK, raising expected GDP growth in 2025 from 1.2% to 1.7% which puts the UK significantly ahead of European rivals like France and Germany, and behind only the US and Canada in the G7. While this rate of growth remains modest by historic standards, 2025’s growth rate is expected to be twice as fast as 2024, so this could stimulate economic activity and hiring. We also see signs that more technology professionals are looking to move during 2025. A pulse survey of intentions that we carried out on LinkedIn in December found that 68% of technologists were actively looking for a new role, while a further 9% were planning to start looking in the New Year. This represents an increase in activity from last summer when the Harvey Nash2024 Global Tech Talent & Salary Report found that 50% of UK tech professionals were looking to move to a new organisation in the coming 12 months. There are a number of areas where I expect to see increased recruitment demand: · Big Tech: The Big Tech firms have largely recovered following a period of retrenchment and are beginning to hire again. They are also continuing to invest in the UK – during 2024 Google, which already has more than 7,000 UK staff, pledged to invest $1 billion in anew data centrein Hertfordshire. Microsoft also committed to investing an extra £2.5 billion in the UK. · Financial services: The industry’s resourcing requirements have strengthened in recent months, and I expect to see continued activity, with particular demand on the contingent staff side. AI and machine learning are priority areas. · Public sector: With the government committing to increased investment in the public sector, I anticipate that the kickstarting of projects here will be accompanied by a renewed wave of hiring (particularly contingent staff) following a fallow period in the run-up to the election. The government also recently announced that it would be recruiting staff from tech start-ups in a secondment scheme to embed a ‘test and learn’ culture across government departments, backed by a £100m innovation fund. · Tech start-ups/scale-ups: AI and other emerging technologies are of strategic importance, and I expect the technology start-up and scale-up market to be a strong performer with a continuing need for talent. · Green tech: We are seeing continuing demand for technologists with expertise in green and clean technology solutions and materials as organisations pursue a sustainability agenda and work towards net zero goals. Headwinds to negotiate These factors will inject some life into the market – but there will also be a number of elements that tend to push in the other direction. Firstly, even if the UK may be better placed than some other major countries, the economic outlook continues to be underwhelming. There is also the significant wildcard of Donald Trump assuming the presidency in the US and the possibility of tariffs and increased trade wars. How much this may impact the UK is uncertain. What is certain, however, is that the world continues to be an unsettled and volatile place. Employers are set to continue to take a cautious approach. Secondly, the government’s planned increases to employer National Insurance contributions could have a significant impact. It is likely to have the biggest effect on sectors with high numbers of lower paid staff like retail, hospitality and leisure – but technology won’t be immune. In a global market where tech talent is available anywhere, the increased costs of employing UK talent may lead employers to invest in building or growing their technology teams in other locations instead. Added to this we have the government’s forthcoming package of workers’ rights which, while great news for individuals, will add to the cost and responsibilities of being an employer. Meeting some of the requirements could be a particular headache for start-ups and SMEs – and further incline them to invest in a more remote technology talent model. AI unknown One area that is still largely an unknown is AI. This continues to be a major focus for investment and exploration by businesses – but the real nature of its impact on technology recruitment remains unclear. As yet, it hasn’t led to an explosion in new AI-specific roles. Rather, there is an expectation that technologists can harness and use AI within their roles to enhance productivity and efficiency. It’s a skillset and a capability that is becoming expected. On the other hand, I am yet to see a clear example of job losses because of AI. In short, the impact of AI on the technology jobs market (in terms of number of hires) has so far been largely neutral. Needless to say, the technology is maturing and developing at a rapid pace – so could 2025 be the year that it begins to spawn new roles at scale? One way in which AI is having an impact is on the application process – with increasing numbers of candidates using AI tools to help them make tailored applications, and employers using AI to automate processes including candidate screening and scoring. My message here is simply not to lose the human touch. Candidates should be displaying their own personal skills and attributes, not over-depending on AI to do the work for them; while employers should build in checks to ensure the use of AI is inclusive and not excluding certain groups. They need to show that they are human and personalised organisations that care about people. The importance of culture in the competition for talent We know from the Harvey Nash 2024 Global Tech Talent & Salary Report that technology professionals are placing increasing value on the culture and working environment at an employer – this has become one of the keys to both attraction and retention. This is crucial because, even though we may not see booming conditions in the technology recruitment market, there will nevertheless continue to be significant competition for the best talent with skills shortages in priority areas such as data, engineering, AI/machine learning, software development and cyber. For instance, the Recruitment and Employment Confederation (REC) found in November that software engineers and developers are still one of the most in demand roles in the UK. The employers that can demonstrate a compelling employee value proposition (EVP) will have a significant advantage over the rest in attracting this talent. Diversity high on the agenda A further priority during 2025 which will also facilitate activity is the diversity agenda. We continue to see a real focus amongst employers on strengthening the diversity of their technology teams. They are looking to their partners and suppliers to help them do this – by encouraging applications from diverse talent sources, building relationships with under-represented parts of the community, and creating new recruitment pathways and talent schemes. Expect the unexpected? Overall, my expectation is that 2025 will be a solid but unspectacular year for technology recruitment. However, the nature of the market is that it can move from red to green at a moment’s notice – with no amber in between. We saw that in the post-Covid boom. That may have been the result of a fairly unique set of circumstances, but with AI developing at pace and many other unknowns, employers (and candidates) need to stay agile, flexible and prepared for the market to take an unexpected turn at any time. About the author Andy Heyesis the Managing Director Harvey Nash UKI, Central Europe, Australia & Spinks. He is also a member of Nash Squared Executive Leadership Team. Andy has been at Harvey Nash for 25 years and has extensive experience working across all sectors and industries. Starting out in the contracts division of the London Office, Andy quickly progressed and was appointed as Managing Director for the UK South Technology Recruitment Business in 2020.

Harvey Nash UK&I, Germany, Poland, Switzerland, Australia and Spinks Managing Director Andy Heyes discusses a trend that has been been emerging recently - fractional working. This article first appeared onComputing.com. Working patterns have transformed in recent years, with a significant rise in flexibility including hybrid and remote working. Although there is something of a return to in-office working again as Covid recedes into history (our research suggesting that three days a week in the office is becoming the norm), nevertheless one of the pandemic’s legacies is a shift in how individuals work and engage with their employer. Alongside this, there is another emerging trend which may become increasingly common in future years – the notion of fractional working. This is essentially where an individual works on a freelance or contractor basis – but has a portfolio of part-time assignments simultaneously. It’s an established mode for certain senior roles – such as a fractional CISO or CIO – but is beginning to spread further down the layers of the workforce to include more junior positions. This is still relatively rare in the UK, where the great majority of freelancers work on one full-time contract at a time, but is something we are beginning to see more frequently in regions such as Europe. Attractions of the fractional working model From an individual’s perspective, there are several attractions to the fractional model. It brings greater freedom to take on a wider range of assignments, increasing the variety of the working week, with the opportunity to develop new skillsets and specialisms. It increases an individual’s independence and makes them less reliant on any one employer. It also means that there is scope to arrange a workload that allows other activities alongside – ideal for those who are also studying or have parental or caring responsibilities. In this sense, it is a model that may appeal to the Millennial generation, many of whom particularly value their independence and are reluctant, especially at an early stage of their careers, to commit themselves to one entity or pathway. There are also obvious potential attractions for groups such as returning mothers, who need to balance their work schedules with personal commitments. It won’t appeal to everyone, of course. There is a much higher degree of unpredictability and uncertainty, with no guarantee that an individual will be able to secure the number of hours they need. However, if the trend becomes more established then we can expect more fractional roles to come onto the market, giving candidates greater scope to mix and match their working schedule. What’s in it for employers? From the employer’s perspective, there are a number of strong reasons why this may be something to consider. Firstly, it opens up a wider talent field to draw from and may help businesses address the skills shortages that still plague the technology market. Nash Squared’s2023 Digital Leadership Reportfound that 54% of digital leaders say skills shortages continue to prevent them from keeping up with the pace of change. The most scarce skills are data engineers, enterprise architects, software engineers and technical architects. Secondly, sourcing some positions through the fractional model could help organisations boost their diversity and inclusion profiles. Increasing diversity in tech has become a strategic priority for many employers: fractional workers are likely to be a diverse group with a wide range of characteristics. Embracing fractional working for some roles could also make employers more precise in the work they allocate to freelancers. There is greater scope to be very specific about hours, tasks and targets – meaning less wastage compared to contracting with someone on a full-time basis. Although it means more administration due to a higher number of roles and freelancers, it could actually make the business more cost- and time-efficient. The fractional leader At a senior level, the fractional or vCISO/CIO has already become an established part of the technology working landscape – and we can expect to see growth here too. For example, there are more regulations emerging requiring businesses to have a CISO. Not all companies need a full-time CISO (particularly small to medium-sized companies) – but they all need an effective security programme. By engaging a fractional executive, businesses can more surgically apply their professional capabilities, driving up efficiency and pushing down resource costs. For many companies, it's simply having access to a highly experienced professional who has the scars and bruises of having done it before, knows where the pitfalls are, and the tactics that have proven results, and that in and of itself can save a great deal of time, money, and reduce risk. It appeals to many senior and experienced professionals too, especially as they reach the later stages of their career when they may no longer want or need a full-time role. It is an opportunity for them to bring to bear decades of experience in helping organisations improve their technology and security programmes in actionable and pragmatic ways. In tune with the times At the same time, fractional team members are likely to become more common too – from coders and developers to architects, engineers and analysts. One of the triggers for this may be increasing levels of scrutiny of the tax arrangements of freelance and contingent workers, such as the UK’s IR35 regime which brings more individuals onto company payrolls and taxes them at source. Fractional workers are more clearly independent of the businesses they work for and so exempt from this. But it is also likely to grow simply because it is in tune with changing attitudes towards careers and work. There are advantages to be gleaned on both sides – and so we can expect to see growing numbers of fractional workers, and employers seeking them, in the years to come. About the author Andy Heyesis the Managing Director Harvey Nash UKI, Central Europe, Australia & Spinks. He is also a member of Nash Squared Executive Leadership Team. Andy has been at Harvey Nash for 25 years and has extensive experience working across all sectors and industries. Starting out in the contracts division of the London Office, Andy quickly progressed and was appointed as Managing Director for the UK South Technology Recruitment Business in 2020.

As we enter 2024, the economic outlook is cautiously improving – and this should translate into an improving market for technology recruitment. 2023 – a year of consolidation Volumes of tech recruitment in 2023 were lower than those seen in the post-Covid ‘boom’ years of 2021 and 2022 when there was an explosion of investment in technology solutions and, therefore, people. This doesn’t mean that 2023 was a poor year – it was more a case of the market returning to normal pre-pandemic levels. Nevertheless, after the frenetic activity of 2021 and 2022, last year felt like something of a dip. In tough economic conditions, businesses became more cautious about hiring, while candidates also became more cautious about contemplating a move. However, there remained plenty of good mandates out there and some sectors such as energy were very active as they pushed forward with their Net Zero transformation plans. The market for contractors also remained strong, balancing out the tightening in permanent placements. An improving outlook – but risk factors remain With a new year now beginning, there are signs that eye-wateringly high rates of inflation are behind us. There are hopes that interest rates will begin to fall. Cost of living pressures including spikes in the prices of energy and other key commodities may ease, bringing some relief to both consumers and businesses. That is not to say that 2024 will be plain sailing. In what feels like the new normal ever since Covid struck, there are many uncertainties around. On the macro level, geopolitical conflicts such as the wars in Ukraine and Gaza are unpredictable and are likely to have continued commercial ripple effects - the recent disruption to shipping in the Red Sea being one example. Then there is more ‘normal’ political uncertainty. In the UK, an election is expected during the year or in January 2025 at the latest. This may produce a period of ‘wait and see’ amongst some businesses in the months immediately leading up to the election, with some recruitment being paused or slowed down. Most obviously, it is likely to have an impact in the public sector. This has been a big and steady recruiter of technology talent given the number of significant technology transformation projects at play to digitise public services. My hope is that any slowdown in public sector technology recruitment will be short-lived. Globally, the election in the US will obviously be hugely significant. It would be a brave person to give any firm forecast of what will happen, however! More broadly, geopolitical tensions are likely to persist between the West and players such as China. The technology sector will be hoping that the situation regarding China and Taiwan does not deteriorate given the key importance of that small territory in producing so many of the chips on which modern devices depend. 2024 sector trends In short, there are many unknowns and risk factors. However, I remain optimistic that 2024 will be a better year economically than 2023 and will therefore present more opportunities for talented technology professionals looking to move on to the next stage of their careers. The Big Tech players have reset since carrying out some resizing last year and look poised for growth again. Financial Services had a relatively quiet year in 2023, but as economic conditions pick up and financing conditions improve so too their resourcing needs are likely to grow. Meanwhile, through our specialist Nash Squared business Spinks, we are beginning to see increased activity in the technology start-up and scale-up market with venture capital investment increasing. Certainly, we know from our 2023 Digital Leadership Report, which surveyed over 2,100 technology leaders around the world, that talent remains high on the agenda – 54% of leaders said that a skills shortage is preventing them from keeping up with the pace of change, signalling an ongoing demand and need for tech talent. Permanent vs contractor I expect permanent recruitment to build again through the year as companies increase their investment in activity and people and as individuals become more confident about contemplating a move. I also expect the contractor market to continue on the upward trajectory it has already established. The contingent workforce has become a key part of the mix for most larger businesses, and we’re also seeing ‘fractional’ roles appealing to growing numbers of individuals who are attracted by the idea of working for more than one employer. Could this be the way of the future as traditional career models change? Diverse talent pools; AI unknowns Another area I expect to be high on the agenda for Digital Leaders is the building and boosting of diversity in their teams. Businesses want to be more reflective of the wider society within which they operate. They also recognise that diversity of people leads to more diversity of thinking and, therefore, innovation. Certainly, this is an area where the technology sector needs to do better. Our Digital Leadership Report shows that the representation of women in the technology workforce remains disappointingly low – only 14% of leaders and 23% of the workforce overall – while the proportion of those from an ethnic minority background is only marginally higher at 25%. Building more diverse talent pools and pipelines needs to be a continuing priority in 2024. There are signs in our research that the growing return to offices and the reduction of remote working days could have a negative impact in some cases on the representation of women, so this is an area that needs careful managing. One area we haven’t yet seen having a major impact on recruitment – despite all the hype – is artificial intelligence and generative AI. I am yet to see a clear example of job losses because of generative AI. Obviously, that is one to watch – but I am hopeful that AI will create as many new opportunities for people, and expand the range and remit of their present roles, as positions it replaces. Agenda for growth Overall, there is a lot to look forward to in the technology talent recruitment market as the year gets underway. As economic conditions improve, clients will return to their agendas for growth which will inevitably have a technology element to it. Sourcing the right technology talent will be a key part of this as businesses move along their strategic journeys to achieve the objectives they have set. About the author: Andy Heyes is the Managing Director for Harvey Nash UK&I, Central Europe, AUS & Spinks and is also a member of the Nash Squared Executive Leadership Team. He has been working at Harvey Nash for over 25 years and has extensive experience working across all sectors and industries. Starting out in the contracts division of the London Office, Andy quickly progressed and was appointed as Managing Director for the UK South Technology Recruitment Business in 2020. Under his leadership, the Harvey Nash business has successfully grown to what it is today. Andy believes in a very ‘human’ approach, focusing on developing people and ensuring our clients, candidates and contractor communities are at the heart of everything we do.