Software Is Eating The Job Market

According to the Labor Department, the U.S. economy is in its strongest stretch in corporate hiring since 1997. Given the rapidly escalating competition for talent, it is important for employers, job seekers, and policy leaders to understand the dynamics behind some of the fastest growing professional roles in the job market.

For adults with a bachelor’s degree or above, the unemployment rate stood at just 2.7 percent in May 2015. The national narrative about “skills gaps” often focuses on middle-skill jobs that rely on shorter-term or vocational training – but the more interesting pressure point is arguably at the professional level, which has accounted for much of the wage and hiring growth in the U.S. economy in recent years. Here, the reach and impact of technology into a range of professional occupations and industry sectors is impressive.

Software is eating the world

In 2011, Netscape and Andreessen Horowitz co-founder Marc Andreessen coined the phrase “software is eating the world” in an article outlining his hypothesis that economic value was increasingly being captured by software-focused businesses disrupting a wide range of industry sectors. Nearly four years later, it is fascinating that around 1 in every 20 open job postings in the U.S. job market relates to software development/engineering.

The shortage of software developers is well-documented and increasingly discussed. It has spawned an important national dialogue about economic opportunity and encouraged more young people, women, and underrepresented groups to pursue computing careers – as employers seek individuals skilled in programming languages such as Python, JavaScript, and SQL.

Although most of these positions exist at the experienced level, it is no surprise that computer science and engineering are among the top three most-demanded college majors in this spring’s undergraduate employer recruiting season, according to the National Association of Colleges and Employers.

Discussion about the robust demand and competition for software developers in the job market is very often focused around high-growth technology firms such Uber, Facebook, and the like. But from the “software is eating the world” perspective, it is notable that organizations of all types are competing for this same talent – from financial firms and hospitals to government agencies. The demand for software skills is remarkably broad.

For example, the top employers with the greatest number of developer job openings over the last year include JP Morgan Chase, UnitedHealth, Northrup Gruman, and General Motors, according to job market database firm Burning Glass Technologies.

Data science is just the tip of the iceberg

Another surge of skills need related to technology is analytics and the ability to work with, process, and interpret insights from big data. Far more than just a fad or buzzword, references to analytical and data-oriented skills appeared in 4 million postings over the last year – and data analysis is one of the most demanded skills by U.S. employers, according to Burning Glass data.

The Harvard Business Review famously labeled data scientist roles “the sexiest job of the 21st century” – but while this is a compelling new profession by any measure, data scientists sit at the top of the analytics food chain and likely only account for tens of thousands of positions in a job market of 140 million.

What often goes unrecognized is that similar to and even more so than software development, the demand for analytical skills cuts across all levels and functions in an organization, from financial analysts and web developers to risk managers. Further, a wide range of industries is hungry for analytics skills – ranging from the nursing field and public health to criminal justice and even the arts and cultural sector.

As suggested by analytics experts such as Tom Davenport, organizations that are leveraging analytics in their strategy have not only world-class data scientists – but they also support “analytical amateurs” and embed analytics throughout all levels of their organization and culture. For this reason, the need for analytics skills is exploding within a variety of employers, and analytics and data-related themes top many corporate strategy agendas.

Analytics: Digital marketing demands experienced talent

Change is also afoot as digital and mobile channels are disrupting the marketing landscape. According to the CMO Council, spending on mobile marketing is doubling each year, and two-thirds of the growth in consumer advertising is in digital. In an economic expansion cycle, awareness-building and customer acquisition is where many companies are investing. For these reasons, marketing managers are perhaps surprisingly hard to find.

For example, at high-growth tech companies such as Amazon and Facebook, the highest volume job opening after software developer/engineer is marketing manager. These individuals are navigating new channels, as well as approaches to customer acquisition, and they are increasingly utilizing analytics. The marketing manager is an especially critical station in the marketing and sales career ladder and corporate talent bench – with junior creative types aspiring to it and senior product and marketing leadership coming from it.

The challenge is that marketing management requires experience: Those with a record of results in the still nascent field of digital marketing will be especially in demand.

Social media: not just a marketing and communications skill

Traditionally thought of in a marketing context, social media skills represent a final “softer” area that is highly in demand and spans a range of functional silos and levels in the job market — as social media becomes tightly woven into the fabric of how we live, work, consume and play.

While many organizations are, of course, hiring for social media-focused marketing roles, a quick search of job listings at an aggregator site such as Indeed.com reveals 50,000 job openings referencing social media. These range from privacy officers in legal departments that need to account for social media in policy and practice, to technologists who need to integrate social media APIs with products, and project managers and chiefs of staff to CEOs who will manage and communicate with internal and external audiences through social media.

Just as skills in Microsoft Office have become a universal foundation for most professional roles, it will be important to monitor how the use of social media platforms, including optimization and analytics, permeates the job market.

The aforementioned in-demand skills areas represent more of a structural shift than an issue du jour or passing trend. It is precisely the rapid, near daily change in software- and technology-related skills needs that necessitates new approaches to human capital development. While traditional long-term programs such as college degrees remain meaningful, new software platforms, languages, apps and tools rise annually. Who in the mainstream a few years ago had heard of Hadoop or Ruby?

Each month, new partnerships and business models are being formed between major employers, educational institutions and startups – all beginning to tackle novel approaches to skills development in these areas. Certificate programs, boot camps, new forms of executive education, and credentialing are all targeting the problem of producing more individuals with acumen in these areas.

As technology continues to extend its reach and reshape the workforce, it will be important to monitor these issues and explore new solutions to talent development.

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