The tech sector is a cornerstone of today’s economies, contributing to innovation, productivity and growth. It drives advancements in artificial intelligence and cybersecurity, and it can also support the transition to net zero by developing new environment-friendly tools and products.
As the tech sector rapidly expands, it faces significant talent shortages, with demand for skilled professionals outpacing supply. Education and training institutions struggle to keep up with industry needs, and the gap is exacerbated by rapid technological advancements requiring specialised knowledge.
These shortages are further worsened by the fact that the tech industry grapples with issues of unequal access and opportunities for certain groups. Women, workers of racial and ethnic minority backgrounds, youth, and migrants, for example, encounter barriers to entry and advancement in tech-based careers.
What can governments and employers do to combat these issues?
Skills-first hiring
A ‘skills-first’ – or ‘skills-based’ – approach focuses on skills themselves rather than on how they have been acquired. For example, a job advert might feature a list of required skills and competencies, rather than requesting a specific degree or a certain amount of work experience.
Adopting this approach allows companies to adapt more dynamically to changing demands by focusing on the specific skills they need. It can also help firms access previously under-utilised talent, as candidates with alternative credentials – who are more likely to come from non-traditional backgrounds – can be considered equally to candidates with formal qualifications.
Micro-credentials
Micro-credentials are learning opportunities that allow learners to retrain and upskill quickly and efficiently. They are shorter, more targeted and more flexible than traditional credentials such as degrees, and are therefore very valuable to target specific knowledge gaps or address particular skill shortages quickly.
At the same time, there is a lot of variation in the size, and format of micro-credentials, in who offers them and who uses them, and crucially in their quality. This makes it difficult for employers, learners and providers to navigate the wide and varied micro-credential landscape, thus limiting them in tapping into their full potential.
Education and training providers should establish internal quality standards for micro-credentials and break down course content to identify micro-credential components. Governments can assure the quality of microcredentials, e.g. by creating minimum standards or accrediting providers, thereby boosting trust amongst learners and employers.
Boosting outreach
Businesses should also promote change in their workplace practices by removing bias at the hiring stage, actively addressing discriminatory workplace culture, and improving the quality of the working environment to attract and retain talent from underrepresented groups. Improving transparency by for instance publishing diversity statistics or encouraging unconscious bias training are practices that can help build a more inclusive work culture.
It's not just up to businesses — governments and educators have a big role to play too. Governments can help by improving career guidance and encouraging more people to take part in training that builds the advanced digital skills employers are looking for. At the same time, schools and universities should rethink how they teach technical subjects and highlight a broader range of role models to help students see themselves in these careers.
Conclusion
Talent shortages are a lose‑lose situation for everyone: for firms, they hinder productivity and innovation; for workers, they lead to skills mismatches and reduced job satisfaction; for governments, they reduce competitiveness and economic growth. All stakeholders suffer from less efficiency, missed opportunities and heightened economic strain.
By adopting skills-first approaches to recruitment and training, recognising and developing appropriate micro-credentials, and promoting fair and open hiring and promotion practices, governments and businesses can ensure sustainable solutions to alleviate talent shortages in the tech sector.
To learn more, read the OECD report ‘Bridging Talent Shortages in Tech’ here: Bridging Talent Shortages in Tech | OECD