The IT labor shortage won’t go away anytime soon, here’s how MSPs can respond

The lack of sufficient IT talent has been a high-profile problem for quite a while, judging from headlines such as “Bridging the IT Skills Gap” and “Addressing the Skills Gap Before It’s Too Late” when you search Google. Not only is the talent gap real but it’s also viewed as something scary: a ticking time bomb or existential crisis.

The impact of the IT talent gap is also real: It means companies have to spend more to attract, train, and retain skilled IT workers, and salaries for these workers will be higher. But the biggest impact is jobs left unfilled, possibly for extended periods. Seventy-three percent of IT industry leaders predict they’ll struggle to recruit data scientists or fill other open tech positions. This is an issue that threatens the growth and innovation that IT is enabling in all industries, and by extension, it’s a threat to the entire economy. And when we’re talking about cybersecurity, one of the most understaffed specialties, it’s an even more damaging threat. Yes, this issue is that serious.

How the talent shortage affects MSPs

Not surprisingly, MSPs are right in the middle of the staffing struggle. They’re facing the very same hiring landscape themselves and may even be competing with their customers for the same job applicants.

MSPs might be at an extra disadvantage because promising IT workers may prefer to join high-profile startups and digital brands. MSPs are by definition behind the scenes, offering a product that’s meant to support their customers’ business goals. And for MSPs, the pressure is on to remain fully staffed because IT is an essential service, viewed by customers as a utility. Complete reliability, 100% uptime, and continuous evolution to support new technologies are all considered table stakes. Failure is not an option, as the saying goes.

But by looking at the causes of the talent shortage, using an employee-centric view to define HR strategies, and getting creative, MSPs can enlarge their worker pipeline, build a more cohesive company culture, and set themselves and their customers up for future growth.

Where have all the workers gone?

The short answer is nowhere—at any rate, they’re not working for your company. 

The main reason there’s a shortage of workers is simple supply and demand. Most of the US economy was already moving to the internet and mobile computing even before the pandemic, and we all know what happened: The pace of digital transformation went into overdrive, creating even more demand for IT workers. Employers have come to the realization that human capital is a limited resource.

Another answer to the “Where are the workers?” question: Many workers aren’t seeking full-time employment anymore. With remote work here to stay, millions of people have reevaluated their career paths and joined the ranks of freelancers. In fact, the number of US gig workers grew from 57.3 million in 2021 to over 73 million in 2023. Numerous online marketplaces have sprung up to serve these gig workers, who value the flexibility of project or temporary work and want the autonomy and control to manage their own career path. 

As for the new job seekers coming into the market, there are new workforce concerns, notably in North America. Education systems are failing to produce enough graduates with the skills needed to step into IT roles, especially mid-level and upper-level positions.

Why are workers so hard to retain?

One reason is the temptation of job markets where IT skills are in great demand. A 2022 Gartner survey found that only 29% of IT workers intend to stay with their current employers. This creates a dynamic where workers have more power, but they don’t use use it to win higher pay, thye use it to obtain a better work-life balance, flexible work arrangements, an agreeable culture, manageable workloads with realistic goals, and solid avenues for advancement. Deficiencies in any of these areas could be reason enough for a worker to start looking for something better.

There’s also the “quiet quitting” trend. This is the practice of detaching from a current employer’s career path while continuing to punch the clock until something better comes along. Securing benefits such as health insurance may also factor into this move. 

What the IT talent gap is costing

Supply and demand dictate that the IT talent gap results in high IT salaries. Candidates in major North America cities can expect salaries that start at $150,000. While much of the work is mission-critical, in a more sustainable and balanced job market, these numbers would likely be lower. 

The bigger threat from a cost standpoint is high turnover as IT workers are changing jobs more frequently. The costs of acquiring and onboarding are high, and it can take eight to 12 months for new hires to get up to speed and contribute to their full potential. This inefficiency trickles through an organization, creating more work for managers and slowing down project timelines. 

But perhaps the most damaging effect of understaffing is the inability to adopt and develop new technologies as needed. Sixty-four percent of IT executives reported this situation in 2022, compared to only 4% in 2020. This is not just a matter of competitiveness or the bottom line. The new technologies provided by MSPs are what enable their customers’ larger organizational goals and missions. And for the IT industry as a whole, new technologies starve for lack of adoption, which the IT talent gap exacerbates.

Strategies and solutions to find, attract, and retain IT talent

First of all, use an employee-centric approach to learn what today’s choosier candidates are after—and offer it to them. In addition to the givens such as competitive salary, strong benefits, and remote work options, these workers seek professional development and concrete pathways for advancement, including mentorships and training. 

Next, expand the candidate pool by looking in some new places, such as non-traditional or vocational schools. Make a special effort to include people historically underrepresented in the IT industry, including women and older workers. 

One example of a non-traditional source is the ConnectWise partnership with CompTIA, which is part of the Biden administration’s Cybersecurity Apprenticeship Sprint. Newly trained IT professionals with CompTIA certifications are partnered with participating IT businesses for apprenticeships and employment. A partnership like this is a natural fit for the MSP industry, putting people eager to work with companies eager to hire.

One of the most important strategies for retaining valued workers is simply a more hands-on approach in terms of communication and assessment. This means more frequent check-ins with workers to make sure they’re engaged, motivated, and confident of success—for themselves, their team, and the organization. According to a Qualtrics survey, roughly 80% of respondents said that support of personal growth is the most important quality of a company's culture.

Counteract the chronic IT talent gap

Even if you do all the HR steps correctly, you may still have empty chairs in your virtual office that translate into missing links in your productivity chain. You need workarounds and fixes to help your MSP do more with less:

• Automation: Help your employees be happier and more productive by automating repetitive tasks, offer your customers 24/7 support with an automated system, and bolster security by speeding up threat detection and response via ConnectWise PSA™.
• Freelancers: Take some of the burden off your workers by identifying projects that can be delegated to freelancers and using one of the many online marketplaces to find one. This is where a lot of talent has gone in the last few years anyway, and you can select a project partner from a global pool.
• Outsourcing: IT engineers would surely agree that chasing down solutions for minor support tickets is a poor use of their time. It’s a no-brainer to outsource help desk operations to a vendor who can handle minor issues and forward only those that actually require your staff’s direct input. ConnectWise partners can augment their personnel with ConnectWise Integrated Services solutions or ConnectWise Incident Response Services™, both in-depth support solutions that are almost like adding ConnectWise experts to your team.
• Develop existing human capital: Can’t find the right person for a particular position? Train and promote an existing worker with certification courses through industry-recognized programs such as ConnectWise Certify™. The many advantages of this practice include savings in acquisition and onboarding costs and better continuity for project teams. It also incentivizes other workers by demonstrating that your organization invests and promotes from within.