The market for IT specialists is tight. And that is not by chance. While the signs in the first quarter of 2022 were still pointing to a strong expansion of IT teams to drive digitization forward, according to the “Hays Fachkräfte Index” there was already the first dip in demand in the second quarter (- 13 percentage points). Here, the looming inflation was already dampening the hiring mood among companies. In the fall of 2022, what everyone had feared finally came true: Inflation, price increases and the ongoing war in Ukraine. It was simply no longer possible to think of spending more on expensive IT specialists. This trend continued to move slightly downwards in the fourth quarter just ended: Demand again fell slightly (- 9 percentage points).
But why is that?
Despite the crisis: companies count on external IT specialists
After all, more than 130,000 IT jobs remain open across Germany each quarter. In the end, the precarious situation regarding the demand for skilled IT staff must not give the impression that only highly qualified “nerds” are still in demand, although they come at a price and are therefore not even an option for many companies. Pessimism is spreading even among the otherwise optimistically inclined IT freelancers:
“The current crisis situation is by no means leaving the self-employed unscathed.”Thomas Maas, CEO at Freelancermap.
But not everything is in truth as it seems at first glance. Despite the negative economic signs, the IT-freelancer employment field holds real treasures that need to be unearthed. We are talking about areas of expertise such as software development, cloud transformation or IT security, which many companies – 72 percent according to the latest Lünendonk survey– are already staffing with outsiders. Crisis or no crisis.
“Software development is often about adapting old software to new business requirements,” knows Christoph Kugelmann, head of sales at personnel services provider Etengo.
“With cloud business, the task for an experienced IT-freelancer is a bit more basic. He needs to be concept savvy and know the architectures to ensure a smooth data transfer at the end.”Christoph Kugelmann, COO Etengo.
Companies also have a particularly high demand for IT security. This is essentially about these experts understanding the context in terms of security architectures. You should also be proficient in vulnerability assessments as well as penetration testing and identity and access management. “In addition, more and more IT security experts are also being commissioned to advise and raise awareness among our clients ‘ employees on the subject of “IT security” in general,” says Alexander Raschke, member of the Etengo Management Board.
The cloud and security competence areas are the most lucrative
The market researchers at Lünendonk also see the greatest demand among specialists for software development and cloud services, as well as in IT security. According to their survey, SAP consultants continue to be highly rated by the companies commissioning them. There is even increased pressure to act here, as the maintenance of previous ERP products will be phased out by 2030 at the latest. IT freelancers who already have ten years of experience in IT security or IT auditing are likely to benefit most from this development in demand, as they currently receive the highest hourly rates on the market. Although Lünendonk’s figures are unsupported, according to various staffing service providers, an experienced expert in this field can easily quote up to EUR 210 per hour. This is closely followed by SAP consulting and cloud transformation. EUR 110 was given as the average value. However, there are also factors that significantly influence these hourly rates. “If someone works remotely or agrees to project durations of between 12 and 18 months, this also affects the billing rates,” Christoph Kugelmann knows. Experience in combination with a high level of technical specialization are still the decisive factors for companies to win a quick, high-paying contract. But even these lucrative project areas eventually run out of specialists.
The external IT junior staff understands new technologies
After all, a lot of valuable know-how is already being retired today. Long-standing programmers who were still proficient in the Cobol programming language, project managers who were able to assume overall responsibility for international teams, or specialists in the IT infrastructure environment who managed legacy systems.
This is a good opportunity for the upcoming generation of freelancers to prove themselves in various fields of IT. Although this cohort rarely deals with old programming languages, they bring fresh know-how for the introduction of new technologies. “Junior experts are increasingly interested in new technologies, such as artificial intelligence. They are inquisitive and willing to take an in-depth look at them,” Kugelmann continued. And the demand for these competencies is steadily increasing.
However, according to the Etengo manager, the IT freelancers who have the best chances of winning lucrative projects are those who are not only concerned with the technical side of things, but also with communication skills. In other words, the days of obdurate “IT nerds” in the back room are over. IT freelancers who know how to thematically educate their clients and project teams, explain backgrounds and make their own steps within the project comprehensible will have a clear advantage. Also financially. Because as long as things work well between people, they are willing to compromise on the technical side. This is the conviction of the personnel service providers.