What is causing mid-level talent crisis in IT? How is it affecting the industry?

There is a peculiar mid-level crisis going on in the Indian IT industry in India, affecting many new deals. The crisis also highlights the importance of mid-level managers, who play a very significant role in the day-to-day operations of IT services companies, learning new skill sets.

Experts point out that the mid-level talent crisis is majorly due to rapid digital transformation, necessitating the workforce to learn new-age tools and systems, familiarise themselves with adaptive workflows, and have a digital approach to problem-solving. The inability to keep up with the demands of disruption and Industry 4.0 is a significant factor that is contributing to the escalation of the mid-level skills gap. IT companies are working to solve this talent crisis and are trying to re-skill their people accordingly.

“Indian tech players as well as others in different sectors have understood the value of upskilling and training. Many organisations are navigating the talent market by backing their employees up with regular learning and development initiatives. Many employers are mitigating mid-level skill gaps through internal mobility that deploys capable professionals across roles and divisions. Trends noticed across sectors indicate skill gaps to be mainly in the areas of emerging technologies such as AI, data science, cloud, cybersecurity, etc. Therefore, employers are investing in training their existing workforce,” remarked Sachin Alug, CEO, NLB Services.

Market experts say in today's dynamic tech industry, the competition for skilled talent is fiercer than ever. “Industry sentiments not only indicate a 17 per cent decline in hiring intentions of companies as compared to last year, but also highlight that nearly 80 per cent of employers face a skill gap while hiring. This challenge is compounded by the changing preferences of tech professionals, as today 85 per cent are inclined towards remote/hybrid working. In response to these challenges, companies are ramping up their efforts to bridge the skills gap. Internship and apprenticeship programmes have proven to be highly effective, and are helping to address skill gaps at the entry as well as mid-levels. A continuous learning culture is the way forward for companies and several organisations have significantly raised their learning and development budget along with taking varied initiatives,” remarked Stella Thomas, head – talent acquisition, Tally Solutions.

Thomas observed that roles related to AI and machine learning saw a 74 per cent annual growth. Hackathons and innovation challenges are further enhancing skill development, with participants demonstrating a notable improvement in their skill competencies. Tally Solutions, for instance, has engaged its majority of our workforce in continuous learning programmes.

“With our internship programmes which are designed to upskill prospective talent, we are witnessing a notable increase in conversions to full-time employment. Moreover, Tally has forged many strategic partnerships with educational institutions to foster skill-based learning in tandem with industry requirements. We also earmark over Rs 50,000 for learning and development per employee per annum. Looking ahead, we anticipate a surge in demand for tech talent, with projections indicating a 25 per cent increase in job openings over the next year,” said Thomas.

Market experts point out that IT companies are facing challenges in executing complex projects involving new-age technologies and tools in IT infrastructure management, deployment of AI, cybersecurity and integration of multiple systems and need leaders on the frontline who are not only subject matter experts but also have a good grip of people skills and customer handling skills.

“Mid-level managers are crucial for the success of IT companies so that the projects are scoped well, delegated effectively, bottlenecks in execution are removed promptly and the team members are coached and mentored proactively. There is a noticeable trend of mid-level professionals gravitating towards Global Capability Centers (GCCs), hence, amplifying the scarcity. This shortage of mid-level talent has prompted IT firms to rethink their approaches towards talent attraction, development, and retention. We will see companies investing in their early-career programmes, rigorous upskilling initiatives and special projects to retain top talent at the mid-level,” Aditya Narayan Mishra, MD and CEO of CIEL HR, told THE WEEK.

Experts such as Alok Shende of Mumbai-based Ascentius Consulting observed that mid-level talent crisis is a perennial issue barring for the top players. “It is equally true that disruption in the middle stratum has consequences in delays and project overruns. And hence there is a need to evaluate the prospects strategically. One of binding factors can be employee share options. This is further buttressed by the fact that IT stocks are cheaper, so at best there will be a marginal dilution of equity,” remarked Shende.