Sourced Report - Christchurch IT Market - September 2017

Welcome to the eighth Sourced Report – your insight into the Christchurch, and now Auckland, IT sector. The data we have collected over the course of our research allows us to provide Canterbury and Auckland technology professionals with the most up to date trends and changes occurring in your local market.

The Sourced Report has now been providing insights into the Christchurch IT sector for three years. From this year on, we’ll also be examining the Auckland IT sector, analysing the unique trends and movements in the market as well as exploring how it compares with Christchurch.

Hiring Activity

Following up from the leading point in our previous Sourced Report, hiring for IT roles in Christchurch has remained strong, with 81% of employers having hired someone in the last 6 months. 24% of these hired for five or more roles. 32% of respondents stated that they had recruited for one or two IT roles, an increase on the 23% seen in the last report. However, there were fewer organisations hiring a large number of people, with just 9% of respondents stating they had recruited for 10 or more IT roles, as opposed to 13% in February. A further 18% stated that they hadn’t hired for any IT roles, a significant increase on the 11% in the last report.

While these numbers make for slightly lower hiring activity compared with March, these are still hugely positive signs for the sector when looked at in context. The slight drop off is mostly seasonal, with hiring picking up further in the summer months. We also saw a more successful level of hiring, with just 29% of employers stating that one or more of their roles was unsuccessfully filled, compared to 36% in February. When looking into the reasons behind hiring, we can see a clear pattern of growth. New work and projects once again emerged as the key drivers for new hires, showing that there is consistent growth in the market, and that the reasons behind hiring aren’t strictly cyclical. New work and projects were a significantly more prominent reason for hiring in this survey as opposed to six months ago. In our February report, 54.05% of respondents listed new work and projects as the key reason for hiring, coming in ahead of replacement of staff by just 3%. This time around, there was a far larger gap, with new work and projects taking 55% of responses with increased internal demand for IT (39%) and replacement of staff (35%) coming in behind. In Auckland, the hiring outlook was also positive, with every respondent hiring for at least one IT role, and 25% recruiting five or more and just 25% stating that there were a number of roles they couldn’t successfully recruit for.

New projects and work again emerged as the most significant driver of recruitment activity, with 71% of respondents stating that this was a key reason for hiring. However, the Auckland sector differed to Christchurch in that increased demand from customers came out ahead of replacement of staff and increased demand for IT from within the organisation.

Employee Priorities

Flexibility and work/life balance has once again emerged as the most important factor sought out by IT professionals when looking for a new role, as well as being the aspect of their current role that they most enjoy. Along with variety of work, flexible hours was the joint most cited response when IT professionals were asked what aspects of their current role they most enjoy, with access to good technology coming in third. Work/life balance also topped the charts when respondents were asked about what they look for in an IT role, with 79% considering it a major factor, ahead of challenges and career opportunities.

In Auckland, we see a very similar story, with flexible hours being the most enjoyed aspect once again. Plus, while amongst Aucklanders, career opportunities (79%) emerges as the key priority when looking for a role, work/life balance isn’t far behind (73%).

All in all, this shows that IT professionals are looking for roles that can fit in seamlessly with their lifestyles. While most employers seem happy to provide this (with more than 60% of respondents stating that they enjoy flexible hours in their role), the response to our survey shows the level importance that talent places on these aspects of their role. If they aren’t able to access this, then employers may find themselves missing out on top talent, who may favour more flexible competitors.

Salary Satisfaction

Hiring is strong and people are staying in their roles, with a drop in the number of respondents who have only been in their roles for a year or less in both Christchurch and Auckland. Flexibility also remains at the top of the food-chain when it comes to priorities at work. However, that doesn’t mean that employers can rest on their laurels when it comes to salary. While salary remains of a similar importance to IT professionals as it always had been, there has been a significant increase in the number of respondents who are unhappy with their salary.

41% of Christchurch respondents stated that their salary was lower than expected, a significant increase on 31% in February. We saw similar results in Auckland, with 44% of respondents stating their salary was lower than their expectation, compared to 38% in February. This just goes to show that while salary isn’t a primary motivator for IT professionals, and is very much secondary behind workplace conditions and flexibility, employers cannot afford to rely on those elements along to retain top talent. Interestingly, we’ve also seen a drop in the number of people expecting to stay in their roles indefinitely, with respondents being more open to moves than they were six months ago. Even employees who might be happy in their roles and may not be looking to move can be persuaded. In our February survey, just 13% of respondents in Christchurch and 10% of respondents in Auckland intended to leave their current role in the next six months, however, in our current survey, 23% of Christchurch respondents and 29% of Auckland respondents stated that they had been in their role for six months or less.

Contractor Numbers

With new projects being the driving force behind hiring, it’s somewhat surprising to see that the number of contractors working within the Christchurch IT sector has decreased. With Q2 and Q3 generally being the time of year where the number of contractors engaged peaks, the 7% overall decrease from February’s survey is an interesting outlier. This is made doubly interesting when looking at employer intentions, where there was an increase in interest when it came to hiring contractors. This could be related to another change from the last
survey, where 100% of employers stated that it was more important for them to hire someone who is a culture fit rather than someone whose fit is purely skills-based. This time around, while it is admittedly a very small number, 3% of respondents disagreed with this. This could be an indication that, while culture is still a leading priority, the increase in projects has caused the volume of work to reach a critical mass, and thus the need for short term skills has increased.

In Auckland, we can see this reflected somewhat, with the number of full-time contractors falling, but the
number of part time contractors increasing, making for a slight net increase.

SME Growth Christchurch/Auckland

Small medium enterprises (SME) once again drive a significant part of the discussion in Auckland, with 48% of respondents coming from companies with 50 or fewer employees. This is up from the last Sourced Report’s 44%, showing that SMEs are continuing to grow at a steady pace, with responses from large organisations with more than 100 people slipping, making up 37% of responses as opposed to 42% in February. In Christchurch, organisations with less than 50 people make up 33% of responses, up on 27% from the February report.

This is mainly due to a significant increase in the 16-50 person company bracket, which saw a 53% increase on the last survey’s results. However, whilst SME growth remains positive, large companies are still clearly dominant in the Christchurch market, with 62% of respondents stating that their company employs 100 or more people. Moreover, 45% stated that IT accounted for less than 15% of their organisation, with just 29% of businesses reporting that IT accounts for 75% or more of their organisation – compared to half of the responses in Auckland.

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