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Where should I go for great technology talent? (Hint: It doesn’t have to be Silicon Valley)

Krista Palmisano
By Krista Palmisano
on August 30, 2016
Silicon Valley isn't the only place to source technology talent (iStock/muddymari) When looking to expand, relocate or update business strategies that impact the IT workforce, many companies automatically assume that the Bay Area (San Francisco and San Jose, California) is the go-to location to source technology talent. While it is true that these are great markets for these workers, they are heavily competitive with unique drivers for the IT workforce there.

Bay Area talent wants to work for top technology firms, take part in projects that enhance their own portfolio, work on the next big technology breakthrough and find jobs that offer them flexibility while expanding their skill set. Top companies hiring in the Bay Area right now include marquee names such as Oracle (2,200 IT openings), Apple (1,800 IT openings) and VMWare (600 IT openings) making for heavy competition, especially as unemployment for IT workers in the region sits at about 1% currently. 

Finding alternative markets for tech talent

All of these factors create a very challenging situation for organizations that are trying to compete head-to-head with technology companies that have a stronghold on IT talent in the Bay Area. Ideally, employers looking for new locations to source IT talent would consider alternative markets, but many do not know where to start.

When targeting markets for IT talent acquisition, several factors should be considered. The first one is obvious - does this market have good volumes of workers in the occupations I’m looking to hire? Second, is this occupation a strength of the market? Strength is indicated by the per-capita density of a skill in a market, which indicates that a greater number of companies are using these workers than other markets. Thirdly, what are the hiring conditions of this market? Has it been showing consistent growth for several years and are applicant pools already under pressure? Or, was it slower to recover, with more moderate growth and people still looking to pursue new opportunities? 

Tech talent acquisition hotspots 

When you assess these factors right now, several markets come out as very favorable when compared to the rest of the US for hiring IT talent: Atlanta, Baltimore, Houston and Phoenix. In addition to having key IT skills in volume and as strengths of the market, these markets have been showing slower growth, have good applicant levels and have considerably smaller IT job openings than the Bay Area, making for less competition. Top hiring companies in these markets include Northrop Grumman (500 IT openings), Home Depot (400 IT openings), Deloitte (120 IT openings) and Wells Fargo (200 IT openings) - quite a contrast from the situation in the Bay Area.

In addition to less competition, the cost benefits of these markets are substantial, with compensation coming in 18% to 30% lower than the Bay Area. Rent in the Bay Area has also been a hot topic in the media lately, and may be causing a trend of tech workers looking to leave the market. Both of these factors can equate to a cost savings opportunity for employers looking for alternative markets for IT sourcing.

Lastly, another benefit of these markets is that each has a substantial number of IT graduates coming from local university systems every year, enabling companies to create college recruiting strategies to ease the competitive pressure for tech talent. In fact, despite far more numerous job openings in the Bay Area, Atlanta, Baltimore and Phoenix have the same or higher amount of IT graduates per year.

Finding the tech talent you need

Although it may seem that the Bay Area is the common-sense place to go to find the best IT talent in the US, the reality of sourcing in the region can cause non-tech companies great strain and high costs. With reduced costs and a much less competitive hiring environment, alternative markets can potentially provide a more fruitful ground for technology talent acquisition. The key is to be smart and strategic about figuring out where to hire.

As markets continue to improve and labor pools shrink, your MSP provider is one of your greatest partners in mapping out talent acquisition plans and targeting areas that make sense for your business - allowing you to take this smart and strategic approach. AGS regularly assists clients with market selection research relating to relocation and expansion efforts; if we can be of assistance in this area for your organization, please contact us today.

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Krista Palmisano
Written by Krista Palmisano
Krista Palmisano has nearly 15 years of experience in providing market and business analytics. Starting her career with Allegis Group at TEKsystems in 2000 as a Market Research Analyst, Krista participated in and supported annual company strategic planning sessions with senior management by incorporating research data into company planning. She also conducted all phases of customer surveys, managed a market segmentation and branding study used to create company value proposition and supported 85 field offices with market research. From there, Krista moved onto a Lead Analyst role with a technology startup, where she oversaw all aspects of project data life cycle for clients and managed a team of six analysts. Returning to Allegis Group in 2010 to work at Allegis Global Solutions (AGS), Krista moved into a Lead Research Analyst and then Senior Manager role specializing in labor market economics and the impacts on local labor pools, as well as assisting clients with workforce planning initiatives such as site selection planning and global workforce mapping. Key areas of focus include: conducting labor market analysis across the US, EMEA and APAC using a variety of data sources including DOL, BLS, Census, ONS, Eurostat etc.; supporting client consulting engagements to assist clients in workforce planning, placement and costs; building and advising clients on rate strategies and rate cards to manage contingent labor costs; publishing voice of the market research for clients and industry groups. Krista attended Roanoke College where she earned a Bachelor of Science in Psychology with a concentration in research design and analysis.

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