Preparing Your IT Hiring Budget for 2018

Great business leaders understand that employees are the most important part of an organization, and that’s why there’s so much pressure to create and execute an appropriate and effective talent acquisition budget. In IT this is complicated by a dramatic shortage of talent that is increasing salaries and contract rates, making it more difficult than ever to budget into the future. Despite the challenges, there are several proven ways to prepare and execute an IT hiring budget in 2018.

Review Positions Thoroughly

When budgeting for staff, most organizations know to review their current positions, and yet few do so thoroughly. Internal communication lapses often leave departmental managers outside the budgeting process, when in fact they’re important parties in determining the amount of hiring that will happen throughout the year. Staying connected with these managers who see the intricacies of what goes on day in and day out can help you avoid becoming blindsided by the unanticipated need for a new hire in the middle of the year.

Consider this: 65% of organizations were hiring more in the second half of 2017 than they were in the first half. Was this the case for your business? If so, is that increase expected to carry over into early 2018, or is your second half of the year usually heavier in hiring? This makes a big difference in creating a budget and allocating funds. Considering the big picture and determining which employees plan to retire, which consultants have contracts that are ending, and which initiatives will require additional talent are keys to forming and adhering to realistic hiring expectations.

Align IT with Business Objectives

While reviewing positions that will be necessary in 2018, consider the initiatives that your organization is undertaking. New technical projects, moving into additional markets, expanding products or services, or simply meeting a growing demand are just a few reasons many companies ramp up their IT workforces. Additionally, strong cybersecurity is necessary throughout all initiatives to avoid a crippling Petya or WannaCry ransomware attack. Aligning all IT functions with 2018 business objectives is crucial to accurately assessing the number of tech roles necessary for your organization. Doing so makes proper budget execution and adherence drastically easier.

Understand Market Rates

Before making a purchase as a consumer, you likely do some research to make sure you’re getting what you need at an appropriate price. Determining how much it costs to secure top talent is no different. Payroll makes up a huge portion of business expenses each year, and knowing what salaries and contract rates to anticipate requires research just like any other purchase.

Often, you’ll already have a baseline expectation because many roles are not new to your organization. However, just because an employee is retiring or completing their contract soon does not mean that their salary or rate will be right for a new hire in that same role. Even if it has been less than a year since you’ve filled a certain type of position, the IT landscape changes rapidly.

To determine an appropriate IT hiring budget, you’ll need a strong idea of accurate compensation for positions in 2018. This can be done most effectively by taking multiple sources of information into account. Reviewing reported salaries and rates, both general and in various locations, can conveniently be done online through websites such as PayScale. Speaking to friends who are also business leaders or hiring managers in tech can be helpful, as is inquiring about typical pay at conferences, reviewing industry publications, or working with a staffing partner who has a pulse on the market. In the end, the goal is to create a composite expectation based on outside sources, personal experience, salary and contract rate history for the role in your organization, and the experience level of the ideal candidate. These expectations can be reviewed and updated throughout the course of the year as an IT hiring budget is executed.

Examine Cost-Per-Hire and Peripheral Expenses

Of course, a hiring budget must take into account more than just compensation. Hiring takes time and attention from hiring managers, recruiters, and the HR department. It takes resources and money whether in the form of job board fees or candidate assessments. These add up to an average cost-per-hire of $4,129, showing that it takes a significant amount of money to recruit the right IT pro. On top of that, there are often costs associated with a new hire that are either harder to see or easier to miss. These could include lowered productivity during training or acclimation periods, or in the case of 45% of businesses, fringe perks such as gym memberships or lunches.

Amazingly, studies show that many companies are trying to hire more staff while utilizing the same recruiting budgets. Unfortunately, this only serves to compound the difficulty of hiring in today’s IT market. A successful IT hiring strategy requires anticipating the full costs of recruiting candidates and understanding there’s a cost-per-hire that adds dollar figures to the budget with every additional employee desired. As 2018 continues, monitoring these expenses is critical to sticking to a budget.

Alleviate IT Hiring Budget Worries

If creating an accurate IT hiring budget is a science, then adhering to that budget is a skill. There are many factors to consider when executing your budget in 2018, but ultimately the strength of an organization depends on the strength of its talent.

At MDI Group, we partner with organizations of every size in various industries to deliver the right IT talent tailored to each unique business environment and budget. Our ID2 Workforce Solution is a proven and cost-effective way to strategically land the tech talent necessary for success. If you want to alleviate the headaches that come with budgeting for IT talent in 2018, contact us today.

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Brian KnappBrian Knapp is the Chief Administrative Officer at MDI Group. If you are interested in learning more about how to hire the best IT talent, contact Brian directly at bknapp@mdigroup.com, or call us 888-416-7949.  MDI Group has offices and specializes in recruiting IT talent in Atlanta, Charlotte, Dallas/Fort Worth, Greenville, and Phoenix. Looking for a rewarding career in Sales or Recruiting? MDI Group is hiring today!