The growing demand for Digital Transformation in the New Normal, and the changing perception of human resources as a personal issue

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The growing demand for Digital Transformation in the New Normal, and the changing perception of human resources as a personal issue

On January 29, 2021, the Ministry of Health, Labor and Welfare announced that the average effective job offer ratio for 2020 was 1.18 times. This is 0.42 points lower than the prior year. The number of active job offers decreased by 21% from the previous year, while the number of active job seekers increased by 6.9%. The general trend is that the number of job openings decreased in contrast to the trend seen in the number of jobseekers to the number of job seekers. One of the reasons for this is probably the spread of the new coronavirus.

If we focus on the IT field, we often hear that "digital transformation (DX) personnel" are in demand. IT engineers, in particular, are essential to a company's DX strategy, and there is a continuing shortage of them.

Ms. Kyoko Kita, editor-in-chief of doda, a career change service of Parsol Career and an expert on recruitment and career change trends, said, "The Corona crisis has changed the market from a seller's market to a buyer's market. However, according to our survey, the ratio of job openings in the engineering field in December 2020 was 8.08 compared to the previous month, so we cannot say that the shortage of human resources has been resolved.”

"Let's take a look at the trend of IT jobs in 2020 in terms of number of jobs and monthly salary. The data was collected and compiled by Fosho, the company behind the job-specific sales support tool "Kako Koko Hitori-kun," focusing on jobs for full-time engineers (system engineers, web engineers, infrastructure engineers, etc.). The target sites are Town Work, Rikunabi NEXT, Mynavi Byte and Mynavi Career Change. The period covered is January to December 2020.


Table of Contents

  1. Job offers hit the bottom in mid-2020, gradual recovery thereafter

  2. Salaries reached a new high at the end of 2020

  3. The ability to make solutions in response to changes in the business is required


Job offers hit the bottom in mid-2020, gradual recovery thereafter

First, let's look at the number of job openings. The number of job openings peaked in March 2020 and has been on a downward trend ever since, bottoming out in June and gradually rising.

Number of engineering jobs (2020, total of Tokyo, Osaka and Nagoya) Compiled by Nikkei Cross Tech based on data compiled by Fang Zheng.

Number of engineering jobs (2020, total of Tokyo, Osaka and Nagoya)
Compiled by Nikkei Cross Tech based on data compiled by Fang Zheng.

Percentage change in the number of jobs Changes in January 2020 are set as 100%.

Percentage change in the number of jobs. Changes in January 2020 are set as 100%.
Compiled by Nikkei Cross Tech based on data compiled by Fang Zheng.

The first declaration of a state of emergency was issued between April and May 2020. The reason why the bottom fell out of the job market almost a month or more later is explained by Kita, editor-in-Chief of doda: "Many companies had no idea what the Corona disaster would be like and were just waiting to see. At that time, only a few companies were able to establish a remote system. Many of them were considering the impact on their own companies in terms of job offers due to the circumstances that took time to develop.

Around 2018, "remote interviewing" was described as a digital interview or video interview. It was thought that remote interviewing would be convenient for people living in rural areas if they interviewed remotely, and it couldn't imagine that this would become an essential feature as an alternative to face-to-face work, let alone interviewing, three years later.


Salaries reached a new high at the end of 2020

What are the trends in salaries? We have overlaid the graph of monthly salaries on the graph of increase/decrease in the number of jobs shown above.

Changes in monthly salary and number of job openings in 2020
Compiled by Nikkei Cross Tech based on data compiled by Fang Zheng.

From January to March, when the number of cases was high, the average monthly salary was relatively low. After April, when the spread of corona infection became more pronounced, the number of cases decreased (and then reversed), and the monthly salary increased. It reached the highest amount in December of last year.

If you are an engineer, your income may vary depending on your experience and the language you are proficient in. In the "Survey on Programming Language Usage" conducted by Nikkei Cross Tech from June to July 2020 for IT engineers, the average annual salary of 711 respondents was 6.64 million yen. If you simply divide by the number of months, it comes to over 553,000 yen. In terms of annual salary by language, the average annual salary of engineers who mainly use the recently popular Python language is 6.36 million yen, which is lower than 6.64 million yen.

Also look at the regional rankings. In Tokyo, Osaka, and Nagoya, the average monthly salary rose in all regions from January 2020, although there were ups and downs.

Change in average monthly salary in Tokyo/Osaka/Nagoya. Changes in January 2020 are  set as 100%.
Compiled by Nikkei Cross Tech based on data compiled by Fang Zheng.

The ability to suggest solutions in response to changes in the business is required

We understand that there is a sense of depletion in IT personnel. Salaries are also rising. But what if we think of it in terms of ourselves?

According to Editor-in-Chief Kita, many companies are currently reviewing their business strategies after the Corona crisis. This is because the way they provide services has changed. In the face of the Corona crisis, which has made it difficult to predict the future, companies are giving high priority to experienced workers who can make an immediate impact, but they are also continuing to hire potential workers (those with no experience) in areas where it is difficult to recruit. However, in areas where it is difficult to recruit, we continue to hire people with potential (no experience). It is important to hire people who match the business strategy.

If a company is trying to promote DX, what is required is an "aggressive SE" who can propose ways to increase productivity by utilizing technology. Editor-in-Chief Kita points out that "inquiries for DX projects from consultants and SIers are increasing, so there is a high need for people who can propose reforms and Web engineers. The essential fields required by DX, such as security, are also likely to be hired on a potential basis.

The pandemic is forcing companies to change their businesses, and engineers who can propose reforms and make solid recommendations to overcome the challenges they face are highly valued. Engineers who can appeal to such an attitude to companies that are rethinking their business strategies will have more opportunities, while those who lack ideas will find it difficult to get hired or change jobs, even in a market with a sense of exhaustion.

It is safe to assume that Corona will continue for some time. Even if you're not thinking of changing jobs, this pandemic will probably force you to propose or devise some kind of business reform. If this is the case, everyone will need to change themselves into a proactive proposer.

In fact, some companies are working to change the skills of their personnel to promote DX. The case of Sumitomo Life Insurance, where engineers who have worked on legacy systems for many years are transforming themselves into DX personnel, may be instructive.

According to a survey conducted by the IPA (Information-technology Promotion Agency, Japan) in its "IT Human Resources White Paper 2020," published on August 31, 2020, of the 500 advanced IT workers who deal with the Internet of Things (IoT), artificial intelligence (AI), 5th generation mobile communication systems (5G), data science, etc., the number of respondents who answered "yes" to the question "Is it necessary for my job? 

Of the 500 advanced IT workers dealing with the Internet of Things, artificial intelligence (AI), 5G (5th generation mobile communication systems), data science, etc., 20.6% "voluntarily study regardless of whether it is necessary for work" in order to improve their skills. Among the other 500 respondents who were not engaged in advanced IT, 16.0% said that they study voluntarily, regardless of whether it is necessary for their work. "More than half of the non-experts answered that they rarely study outside of work (outside of the workplace).
Engineers who hone their technical skills will have a greater chance to contribute to the creation of businesses beyond the COVID-19 crisis. How can we change ourselves in the midst of this "sense of exhaustion" while envisioning human resources who will change to an "aggressive" attitude? Now is the time for you to think about this issue for yourself.