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An increasing number of companies are failing to drive their digital transformation forward due to a lack of the necessary specialists.
According to a survey by the IT association Bitkom, Germany currently has around 137,000 vacancies for IT specialists, which is an even greater shortage than in 2019, the last year before the pandemic, when there were 124,000 vacancies. 'The shortage of IT specialists is increasingly causing problems for companies and will worsen dramatically in the coming years,' says Bitkom President Achim Berg. 'Demographic change means that significantly fewer young people with IT qualifications are entering the job market, while more older people are leaving relevant professions.' The shortage of skilled workers is becoming the main obstacle to digital transformation.
Source: „Anzahl zu besetzender IT Stellen in der Gesamtwirtschaft“, Bitkom Research 2022
However, upon closer inspection, the situation is not as problematic as it initially seems. Many IT specialists have become freelancers in recent years, so there are still plenty of them available on the market. Why is that?
There has been a profound change in the demands placed on work, especially among young Gen Zers, who want more flexibility, not just part-time work, home working and remote working. In April 2022, the job portal StepStone surveyed around 11,000 working people for a study entitled 'Future. Work. Today”. Almost 80 per cent of respondents believed that they could better achieve their personal career goals if they could freely vary the scope of work and type of employment at any time, i.e. switch between full-time and part-time work, or between freelance and permanent employment. A similar proportion favour the option of being able to work remotely – i.e. digitally and location-independently – at any time. The option of being able to change jobs flexibly at any time was also very popular.
Source: Study “Future. Work. Today. The Guide to the World of Work in 2030,” Stepstone / Handelsblatt Research Institute
Against this backdrop, the prospect of freelancing is becoming increasingly appealing. Indeed, 88 per cent of respondents still say that job security is an important factor in their career decisions. However, this no longer rules out a freelance career, especially given the widespread "workerlessness". Even a competent freelancer need not worry about finding work. It is therefore unsurprising that 60 per cent of those surveyed expect there to be significantly more freelancers in the future.
This constantly growing pool of talent is not made up of people who would prefer a fixed-term contract and a traditional 9–5 job with a fixed salary and notice period. On the contrary, most freelancers consciously and confidently choose professional freedom. They are also correspondingly more satisfied than permanent employees, particularly in the fields of IT, engineering, finance, and life sciences. This was the outcome of a survey conducted in January 2022 by the recruitment agency GULP, in which 781 individuals from these sectors were interviewed, including 386 freelancers. The results showed that 51.8 per cent of freelancers were 'very satisfied', compared to just 16.9 per cent of permanent employees.
Quelle: GULP Arbeitsleben Studie 2021
The trend of freelancing has particularly affected the U.S. market. An increasing number of professionals are questioning the concept of permanent employment, with the terms “The Great Resignation” and “Quiet Quitting” gaining traction. Freelancing appears to be the answer, according to a survey of 3,000 professionals by the American freelancing platform Upwork. According to the survey, freelancers accounted for 39 per cent of the workforce in 2022, compared with 34 per cent seven years earlier. Higher pay is the main attraction: 83 percent of those surveyed by Upwork cited “additional money” as their motivation for freelancing, followed by the desire for more flexibility (73 percent) and control over their financial future (72 percent). Furthermore, freelancers report greater satisfaction in all areas of their professional lives, and they also feel healthier and able to devote more time to their families and social contacts.
Source: “Freelance Forward 2022” study, Upwork
The trend of freelancing is particularly noticeable in the tech sector. Following the 'Great Resignation', top performers in particular have left permanent positions – the prospects for freelancers simply look better. Consequently, most companies have turned their organisational structures upside down and now work with mixed teams of freelancers and permanent employees. This also means that recruitment processes must be completely overhauled.
The situation is similar in German IT organisations. 'The traditional job market is empty, and those looking to fill permanent roles must be prepared to pay significantly more,' says Hans-Ulrich von Freyberg, CEO of the digital agency Cocomore and founder of Vicoland. 'For certain topics like SAP Hana, it’s almost impossible to find anyone at all.'
Freelancers naturally benefit from this state of emergency. This was demonstrated two years ago in the “IT Professionals 2021” study, for which Computerwoche interviewed 437 IT decision-makers. According to the study, 78 per cent of companies had employed external specialists in the previous twelve months. The proportion of external employees in IT organisations is now 53 per cent, compared with 50 per cent three years earlier. This trend is expected to continue, with 64 per cent of respondents saying that external professionals will be very or fairly important in the next two years. 'Many people want an organisation that breathes: people should be able to work flexibly and fully develop their talents for the benefit of the company,' comments Hans Königes, Head of the Jobs & Careers Department at Computerwoche. 'This study confirms this trend.'
Source: Study “IT Professionals 2021”, Computerwoche
However, the study also shows that there is a large pool of freelancers. Although this pool is large, it does not seem to meet demand adequately. According to the study, 60% of the companies surveyed have fundamental difficulties recruiting suitable external specialists.
In addition, integrating freelancers is not always easy. Large projects in particular require a complex set of skills. Consequently, putting together suitable teams can be very time-consuming. Many talented individuals who could contribute greatly are overlooked – either because they haven't had access to large projects before or because they lack the necessary contacts. Traditional recruitment methods often fail at this point.
This is where Vicoland comes in. Rather than placing individuals, the Frankfurt-based company contracts complete teams of experts, representing the next evolutionary step in working with freelancers. Its client list already includes diverse companies such as Samsung, Netflix and HDI Insurance.