Tech CEOs Predict Swelled Use of Offshore Talent

Admitting that finding, hiring and retaining qualified employees is their biggest operational challenge, nearly half of fast-growth technology CEOs said they are tapping overseas markets for talent.

Sixty-seven percent of the technology CEOs surveyed, consistent with the 66 percent in the 2006 survey, said high-quality employees are the biggest contributors to company growth. Finding, hiring and retaining the best employees, however, is continually their biggest operation challenge, cited by nearly half (48 percent) of CEOs, and up from 41 percent in 2006.

This talent shortage has caused tech-company CEOs to increasingly pull out all of the stops to lure in new hires. Sixty-nine percent said they relied on equity compensation and stock options, though down from 71 percent in 2006; 51 percent offered flexible hours, up from 29 percent in the prior study; and 38 percent offered training programs and educational opportunities, up from 35 percent in 2006. Only 31 percent of CEOs said they offered workers a career path, up from a previous 28 percent.

"When it comes to talent, supply and demand are out of balance, making employees more like consumers," explains Jeff Alderton, a principal of Deloitte Consulting.

"And like consumers, if employees with those in-demand skill sets are not receiving the satisfaction they seek from their work place, they will find it elsewhere—with the competition. This will put an even greater strain on employers for available talent."

Technology CEOs said they are increasingly turning to overseas talent to compensate for this shortage of qualified workers, with nearly half (45 percent) stating they are currently offshoring. This percentage will only increase, as 55 percent of respondents said they are planning to offshore in the next five years, so much so that in five years, 30 percent of these tech-company CEOs planned to have one-tenth (10 percent) of their workers offshore. Twenty-seven percent planned to have up to one-fifth of their work force (20 percent), 19 percent expected to have almost one-third (30 percent) and 15 percent expected to have up to 40 percent of their work force situated in other countries.