After the burst of slowdown that hit the global IT industry last year and this year, the labor market in Serbia also felt the tremors. Some people familiar with the situation state that the demand for seniors has decreased, that benefits have decreased – and in some cases also salaries, while companies are struggling to keep existing staff in their ranks. And yet, whether the Serbian IT market has found itself in a real crisis or whether we are simply witnessing a reduction after the pandemic boom – is still an open question.
A sector analysis of the first quarter of this year, conducted by the employment platform HelloWorld, recently showed that a smaller number of senior IT experts are in demand. According to their data, mediators have become a priority for employers.
“There is definitely much less demand for seniors,” says Nedeljko Radojičić, head of operations at the candidate recruitment agency BPS Tech.
As he states for Bloomberg Adria, such a tendency is recorded at the world level, therefore, it is not conditioned by local events. “It is also the effect of the merged courts in the sense that – in addition to less demand and halting employment – the market is also affected by the fact that there are more senior candidates who have lost their jobs, and open positions are closed more quickly, thus ending the need for additional budgets for advertising through HelloWorld and Joberty and the need for agencies ends as well.”
Of course, there are those who deviate from such tendencies.
“In the past five quarters, we have employed more mid-level and senior employees than juniors. In the first four months of 2023, compared to 2022, the situation is almost the same,” says Jelena Subotički Berar, who recently became the vice president of the department for people and culture in the software to Devtech, where he has the opportunity to lead all aspects of employee strategy, including culture, talent acquisition, learning and development, employee experience, compensation and benefits, and people.
She believes that the demand for all seniority will increase in the long term at the world level, which will also affect our market. “We’re optimistic about further development and demand for developers,” she says, adding that the current situation likely reflects short-term fluctuations and strategies to ride out a sort of hiring lull at larger tech companies.
Diversification as a shield against the impact of the crisis
Negative tendencies have also been avoided in the IT company TNation, says their executive director Siniša Kresojević. They amortized them, he says, by diversifying projects. “I believe that the situation is like that in our industry, but in our case, it is not. The reason for this is our strategy to diversify the structure of clients and the areas in which we work as much as possible. I know of some of our IT companies that had 100, 200 people working for one client. And now they ran into a problem when that one client canceled,” says Kresojević.
He adds that at the moment they have 16 ongoing projects, and that these are multi-year contracts and teams of different sizes. “For example, we have shrunk our team on a project related to the healthcare industry in Scandinavia, but right now we are doubling the team for a project related to transportation, where the end user is a German railway or, say, a project for a fintech company in Sweden . Such a dynamic is normal, even in periods when there is no crisis. Companies whose income is dominated by one client – they are in trouble.”
He assesses that startups are also in an unenviable position, due to the bankruptcy of banks in the United States of America, and that is why they now emphasize working with large corporations. “Also, we predict long-term problems for the overall economy of North America and Europe, that’s why we are now turning to some new markets,” says Kresojević.
How to interpret layoffs?
Our portal has already written about layoffs in Serbian IT, shared by, among others, Microsoft, Quantox Technology, HTEC Group… However, not everyone would characterize this as a sign of a crisis.
“These are certain companies that I would say were carried away by this wave of investment in the past period, which very aggressively began to expand. But this optimization and, I would say, the correction of the market that is currently happening stopped them. We have to really look at the situation realistically and see that these are really individual cases,” Milan Šolaja, executive director of the Vojvodina ICT Cluster, recently told Bloomberg Adria TV.
In addition, official statistics, which Prime Minister Ana Brnabić pointed out recently, show the growth of employees in IT from quarter to quarter. The head of state also announces that this year the broader industry of information and communication technologies will record record exports, worth four billion euros.
Benefits and salaries
When it comes to benefits for employees, the executive director of TNation says that they have not changed in their company, nor do they intend to change or reduce them. “We have always tried to provide our employees with some realistic and normal benefits, we did not go to extremes and followed the trends at all costs, so now we do not even need to react in particular,” they say. Even Devtech did not cancel benefits due to the current situation in the industry, but, as they state, during the last year they updated and expanded the package of benefits, which are characterized by flexibility and the choice that employees can make according to their affinities.
On the other hand, Radojičić claims that benefits in the IT sector, broadly speaking, are decreasing because now the focus is on salaries and less on benefits. “As for salary trends – depending on the position, some salaries continue to grow and some stagnate. For machine learning, for example, there are no lower salaries, but for, say, developers working on solutions for mobile phones, we can notice downward trend in wages.”
The level of earnings Is a particularly problematic issue in times of persistent inflation, which we are currently witnessing, so it appears more often in the conversation between employees and management.
“It is inevitable that we face this issue in the current circumstances and we are trying to respond to the situation with longer-term, optimal solutions, which in this case rely on adjusting the salary range and rewarding based on performance,” says Suboticki Berar.
There are requests for raises, but not too many, Kresojević points out, because their employees are aware of the overall situation in the economy. “We have open communication with them and they are aware of our capabilities, so all their requests were based on realism.”
Candidates and employees have more questions
Bearing in mind all of the above, companies notice somewhat different reactions from employees due to the crisis. “Colleagues are now asking HR much more about the stability of the projects they are working on and the stability of the end clients, whose projects they are working on,” says our interlocutor from TNation.
Berar from Subotica presents a similar situation in Devtech, also emphasizing the position that the most important thing for employees is to know if they can maintain a sense of security in an uncertain time. “We use opportunities such as monthly team meetings and Q&A tools to share new information about company events, opportunities, successes, challenges and answer all employee questions.”
At BPS Tech, they state that job candidates are more open to conversation.
“They are aware that the market is unstable and that they could lose their jobs tomorrow, so it suits them to have more options open. Especially since we employ seniors who are mostly people with families to support,” says Nedeljković.
All this means additional challenges for people from the HR sector. “Crisis occasions are an occasion to strengthen and adapt principles such as transparency, trust and responsibility, which we are working on with the team in this case as well”, assesses Suboticki Berar. In addition, she adds, in an industry as dynamic as IT, there is a strong need to nurture the experience of employees, among other things, through a harmonized corporate culture of a company.
“It should be borne in mind that Devtech employed 82 people within six months in 2022, which is almost 50 percent growth in half a year. With such a jump and growth in the number of employees in North America and throughout Europe, and at the same time the plan for the next year, there was an increased need for additional care of employees, retention and expansion of company culture and an approach based on measurable data.”
Sign up for business updates & specials.
