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How Far Will Businesses Go to Lure Developers?

 
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How Far Will Businesses Go to Lure Developers?
by System Administrator - Thursday, 21 August 2014, 6:10 PM
Colaboradores y Partners

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How Far Will Businesses Go to Lure Developers?

 

By Sharon Florentine

IT departments are getting creative to attract and retain elite software development talent. Is this just a temporary bubble or a sustainable hiring practice?

From sign-on bonuses to long-term equity bonus incentives to perks such as paying for the lease on a new Tesla, firms are upping the ante to attract and hire elite software development talent in a tight market.

Most of these specialized performance programs are relatively new, says Dice.com President Shravan Goli. Sixteen percent of 700 employers' hiring managers surveyed by Dice noted that such programs were a new addition in 2014, and 26 percent of respondents say similar programs launched in 2013.

"Companies faced with a tight labor market are getting creative based on the competitive situation they're in," says Goli. When they've reached the top of their base compensation limits, they're faced with a conundrum, says Goli.

HR departments and hiring managers can't exceed certain caps without throwing their budgets and P&L statements into chaos, so individual departments must get creative and look for other ways to get their hiring needs met, Goli says.

[Related: How to Motivate Your IT Team After a Setback]

"They're trying everything they can to lure elite developers to their ranks - sign-on bonuses, equity programs, retention bonuses," he says. And he adds that the number of businesses using these types of benefits is growing, too. Before 2010, only about 50 percent of businesses surveyed by Dice.com said they used programs like this, while the percentage rose to around 90 percent in 2014, he says.

"Companies faced with a tight labor market are getting creative based on the competitive situation they're in," says Goli. When they've reached the top of their base compensation limits, they're faced with a conundrum, says Goli.

HR departments and hiring managers can't exceed certain caps without throwing their budgets and P&L statements into chaos, so individual departments must get creative and look for other ways to get their hiring needs met, Goli says.

[Related: How to Motivate Your IT Team After a Setback]

"They're trying everything they can to lure elite developers to their ranks - sign-on bonuses, equity programs, retention bonuses," he says. And he adds that the number of businesses using these types of benefits is growing, too. Before 2010, only about 50 percent of businesses surveyed by Dice.com said they used programs like this, while the percentage rose to around 90 percent in 2014, he says.

Things are Different in the Valley

"There are two distinct sides to this story; the first being the Silicon Valley and New York city perspective and the other being the rest of the country," Goli says.

"In the Valley and in tech hubs like New York City, compensation, bonuses, perks, incentives are going to be a little crazier and over-the-top because firms are trying to outdo each other and the cost of living is higher. But in other cities there will be more stability and the talent war won't be as aggressive, because the opportunities aren't as widespread. People will be paid more, yes, but there aren't as many technology firms so there aren't as many other places to go," he says.

Of course, Goli says, monetary compensation only goes so far when attracting and hiring talent - retention and longevity are still major issues for IT firms, and businesses must continue to nurture talent on an ongoing basis.

"The bottom line is your people have to be excited about what they're working on. Incentives can only go so far, and pay can only go so far. Companies will still have to up the ante as far as innovation over six, twelve, eighteen months, because the money and the perks are only a temporary fix in the talent war," Goli says.

Link: http://www.cio.com

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