Sourced Report | IT & Technology | August 2020

How has COVID-19 affected IT in NZ?

Key Findings:

1. Well over half of IT workers in NZ got through the COVID-19 lockdown without changes to their hours or pay.
2. Nearly 45% of respondents in both Auckland and Christchurch worked from home as a result of COVID-19, and in both cities the majority found the experience great.
3. Less than 10% of Christchurch employers feel they will have to
   downsize as a result of COVID-19.

For many, the COVID-19 pandemic resulted in a change to their pay and hours. However, the majority of IT workers escaped without such changes, totalling 65.29% in Christchurch and 57.69% in Auckland. In more good news, many Aucklanders (15.37%) who did suffer temporary changes have since returned to normal, although Christchurch appears to be recovering more slowly (just 5.79%). That leaves 10.74% of respondents (Christchurch) and 11.54% (Auckland) still on reduced pay/hours, and a further 5.79% (Christchurch) and 7.69% (Auckland) who were made redundant.

NZ IT Workers in Focus

Key Findings:

1. 54.55% of unemployed IT workers have been without a job for more than four months.
2. Women feel their salary is more fair than men, and also rank salary as less important in their decision to stay at or leave a company.
3. IT workers in both Auckland and Christchurch want work/life balance in a new IT role, followed by career opportunities and a challenge.

For many, unemployment has been long and difficult. 54.55% of unemployed IT workers have been so for more than four months, followed by 18.18% who have been unempl

oyed for one to four months. COVID-19 redundancies are a top reason for these figures, although respondents also indicated that they feel the job market is oversaturated. Visa issues are also an issue, with a large portion of respondents commenting that employers seem reluctant to hire migrant workers.

In this economy, how important is money? We asked employed respondents to rank the importance of salary in their decision to remain at a company or leave, with one being ‘Very Important’ and five being ‘Not Important at All’. 32.64% of Christchurch IT workers – the majority – ranked it as two out of five, while Aucklanders felt it was less important – the majority (29.58%) ranking it as three out of five. Like our March report, men put more importance on pay than women, but only slightly – 2.12% more men than women in Christchurch and 10.58% more in Auckland ranked it as a one or two.

And are these salaries considered fair? Interestingly, our results have flipped since March. Previously, more men than women considered their salary fair. This time, in both cities feelings of fairness tipped towards women – 15.08% more Christchurch women than men think their pay is fair, with 25.98% more in Auckland.

So if not money, then what drives IT workers?

Recruitment Trends in the Changed Economy

Key Findings:

1. Hiring has slowed significantly in the last six months.
2. Despite recent slowdowns, over three-quarters of employers expect to recruit in the next six months.
3. Finding candidates who are the right ‘fit’ for the business (as opposed to simply meeting skills criteria) is now considered less important than it was in March.

Hiring activity has slowed dramatically in the IT space: In March, nearly 85% of recruiters said they had hired one to two IT employees in the six months prior. Now, that figure has dropped to just 35.71%. Looking at those who are hiring, it seems that recruitment has gotten more difficult. Last report, 60% of respondents indicated they had had success recruiting three or more candidates for their open roles. Now, that figure sits at 44.44%.
That said, despite the slowdown just over three-quarters (78.57%) expect to recruit again within six months. Their reasons for doing so? Replacing staff (63.64%), meeting the demands of new work/projects (36.36%), and meeting an increased demand from the customer (27.27%).

Interestingly, it appears that the uptick in hiring difficulties has resulted in a softening of the importance of a ‘right fit’ candidate, as opposed to hiring people who simply meet the skills criteria. We asked respondents in March and again this year to note whether they felt that finding a candidate who ‘fits’ was very important, important or not important. In March, an overwhelming majority of respondents (91.67%) indicated this was very important. Nobody indicated they felt it wasn’t important. However, this time only 71.43% of respondents indicated it’s very important, followed by 21.43% who felt it was important and 7.14% who felt it wasn’t important.

Employers are also poorly aligned with their employees when it comes to the importance of salary. Compared to employees (who noted salary as a two or three out of five), the majority of employers (57.14%) felt it was a four out of five. Could a lack of alignment on the importance of salary be contributing to the current hiring difficulties? This is something we will have to look into further.

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Summary

Nobody expected the industry to look the same now as it did prior to the COVID-19 pandemic. However, overall, the New Zealand IT industry has held up well according to our findings. Most IT workers have survived without being made redundant, and have enjoyed being able to work from home.

Recruitment seems to have fared the worst. Hiring activity has slowed in the past six months, although there is a high degree of optimism that it will begin anew in the coming six months. That said, we found that employers and employees are not aligned on the importance of salary, which may be contributing to some of the hiring difficulties – this is something to watch between now and next year.

Thank you again to everybody who participated in the survey and contributed to the important findings within this Sourced Report. Especially in the current climate, it’s vital that we are all on top of trends and developments affecting the Christchurch and Auckland IT sectors. We look forward to seeing how NZ heals in the coming months, and revisiting the survey in early 2021.

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