How To Close The IT Skills Gap

Redefining value and the future of fintech at SXSW.

The second day of the SXSW Conference started early, because at a conference like this there are always ideas and solutions to cover.

The IT Skills Gap

A morning panel session on the growing IT skills gap defined the program and posited a way for companies to better attract and retain talent from outside the world of IT.

According to panel member Charles Eaton, president and CEO of the Creating IT Futures Foundation, in 2016 there were approximately 2.5 million openings for IT jobs. A majority of these positions were either filled by workers who already worked in IT orwere not filled at all.

Companies aren’t willing to hire someone who doesn’t check all the boxes, he says. So they often hold off on making a hire at all.

Add the current rate for available IT jobs to the rate at which employees are aging out of the workforce and the need to staff up to cover new and evolving IT questions, and the pipeline challenge befalling this sector of the workforce becomes clear.

So what’s the solution?

According to the panelists, apprenticeships have proved an effective way to add new IT blood to an organization. They’re not just for plumbers and electricians anymore.

At its most basic level, an apprenticeship is a system of training workers in a specific field through on-the-job practical work and, often, accompanying study. This concept appeals to IT because of the current high costs at which to hire young professionalswith a college degree.

Heather Terenzio, the co-founder, CEO, and president of the Techtonic Group in Boulder, CO, estimates the average yearly salary for a 4-year college graduate to work in IT in her area to be $85,000. In larger cities, that average is even higher.

And yet, because of the limitations in curriculum at institutions of higher learning, those new hires often require further on-the-job training. So rather than pay the market price for a new hire that still requires more seasoning, apprenticeships allowcompanies to hire for soft skills and train some of the more technical aspects of IT.

It gives companies an opportunity to try before they buy, says Jennifer Carlson, executive director of the WTIA Workforce Institute and Apprenti a nationally registered apprenticeship programthat trains future tech workers. They can make sure hires are a good fit and competent enough to do the work.

Redefining Value

Later in the day, there was a panel discussion on building profitable, sustainable, and authentic businesses, featuring a clothing designer and a chef.

The chef, Travis Lett of Gjelina in Venice, CA, runs an entirely sustainable, farm-to-table cadre of restaurants in the Los Angeles area. His are a few of a growing number of restaurants increasing transparency about the origin of the food they serve.

With that comes cost, Lett says. Finding farmers who meet his sustainable standards is more expensive, and those costs are passed on to consumers. However, he takes a long view in regard to his restaurant and sustainable food.

Customers who eat at his restaurants aren’t just treated to a meal. Rather, they are introduced to a larger narrative around food production in America and the potential future impacts of sustainable agriculture. By starting this conversation, Lettsays, he finds greater brand loyalty among his customer base.

Although his prices are heftier, he’s trying to redefine how customers think about their food.

People come in and question price, Lett says. We’re not saying we’re cheap, we’re saying there’s value in our food. If we want sustainability to catch on, we have to consider the value we ascribe to our food.

Future Of Fintech

Banks and credit unions have been consumers of technology for almost as long as these institutions have been in existence, but with the maturation of the internet and the new technologies it has spawned, fintech companies can and are seriously disruptingfinancial services.

According to Pascal Bouvier, partner at Santander InnoVentures and a panelist during an afternoon discussion called FinTech’s Future: Banking & Beyond, the best way to consider fintech’s impacts on the future of financial servicesis to look at how legacy competitors fared in other industries.

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Consider movie theaters in an age of Netflix, newspapers with Facebook and Twitter, or even the retail industry since Amazon evolved from simply selling books. To keep this from happening to traditional financial service providers and intermediaries,ways of doing business will need to change.

They will have to reinvent themselves or risk being trashed in the dustbin of history, Bouvier says.

But that doesn’t mean that traditional financial service providers can’t leverage fintech partnerships.

There are thousands of fintech startups in America and around the world, and they all share a common bond: to solve a problem they see in the market. Because they are smaller than financial institutions and more focused, they can provide solutions morequickly than, say, a bank or credit union, says Terri Prince, vice president of customer success at CRMNEXT, a CRM solution.

But there are solutions. According to Prince, financial institutions can establish innovation divisions within their larger business operations Capital One, Citi, and Barclays have already done so. FIs can partner with companies producinginnovative solutions. Or, they can buy those companies and technologies outright.

What can’t they do?

As Prince says: Banks can’t out innovate these companies.


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