Hays Market Research Explores if Tech Market Slows Down by 2023

Analysis

Balázs Simon, Team leader, Technology division, Hays Hungary

Amidst a changing economic climate, employers across industries are revising business strategies and hiring plans for next year. Many forecast a slowing recruitment pace, hiring freezes in specific sectors, and an intensifying competition for talent.

However, the technology market doesn’t seem ready to place plans on hold. Balázs Simon, team leader of the technology division at leading recruitment agency Hays Hungary, shares insights from its latest market study on the  industry and the challenges employers face today and in 2023.

In the past year, the technology industry has shown massive growth. With many companies opening new offices and new positions in Hungary, the recruitment boom continued at full speed. Although the outbreak of the war in Ukraine impacted some, most technology businesses in Hungary closed a strong year with high revenue and a larger staff. According to the market research that Hays conducted in August 2022, business expansion plans set out in January did not change considerably during the year, despite the war and the changing economic environment.

“At Hays, we experienced an incredible growth in the number of newly opened positions in our clients’ organizations this year,” says Balázs Simon, team leader of technology recruitment at Hays Hungary.

“There are a few conservative market players that somewhat decreased their hiring pace, but most of our clients are looking to recruit more talent with an optimistic outlook on the future. Now, every company is closely observing the macroeconomic changes and the dynamics of the technology sector, to be ready in case they need to adjust their plans,” he adds.

Tech Talent Value

Today, the biggest challenge for companies is calculating competitive salary ranges. Salary requirements of candidates often grow higher during the selection process, which is a good indicator of how rapidly salaries are changing nowadays in the technology industry.

“Many companies increased their salaries during the year to match rising inflation. According to our latest research, more than half of our clients did so, and we expect yet another wave of increases at the beginning of next year when even more employers might follow this trend,” Simon says.

Most IT contractors want payment in euros or another stable currency. According to the Hungarian labor law, permanent workers can only receive their salary in forints; however, more employers are willing to adjust wages to the EUR-HUF exchange rate.

Most Wanted Skills

“You can search almost any programming language on the internet, and you’ll find an infinite number of open positions in the results,” Simon explains. “As for non-development roles, experts in data science, cybersecurity, SAP, and cloud technology are most needed. In the future, I believe Python and Salesforce knowledge will be the new stars in technology, which are very much present in western countries, and we expect it to be dominant soon in Hungary as well,” he adds.

Senior technology professionals can reach a salary of millions of forints in most IT specialisms today. The hottest positions are in programming, development, data and advanced analytics, cloud technology, and cybersecurity, but experts in ERP and CRM systems also earn high salaries.

Hays Forecast

In the upcoming months, we’ll see whether an economic recession actually happens. Hays expects employers will still face the challenge of increasing salary requirements due to inflation and the skills shortage. This will be particularly true in the technology industry in Hungary in 2023. The consequences of the rising interest rates in the US and the war might also bring surprises for businesses, but most already have a “plan B” for such situations.

“We’ve seen an amazing year with high volume recruitment projects. Within a year, our team doubled in size while our revenue tripled. We enjoy being the trusted and strategic partner of an even broader range of companies,” Simon notes.

“Our Recruitment Process Outsourcing  service is getting increasingly popular. This year we closed nine successful RPO projects for technology partners, and many are still running,” he says.

“According to our latest market research, our clients are not planning layoffs; at most, a slower recruitment pace and more considerate hiring steps. Besides, employers are putting more focus on retention. More conservative companies will also expand over time, while those in a more advantageous position can leverage from the slow down.”

This article was first published in the Budapest Business Journal print issue of September 9, 2022.

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