Why do the engineering and IT unemployment rates differ from the general unemployment rate?

Why do the engineering and IT unemployment rates differ from the general unemployment rate?

This year’s unemployment rates have been staggering. Holding steady at 3.5% in early 2020, unemployment soared to 14.7% during the early stages of the COVID-19 pandemic shutdowns. As the economy slowly reopens, the rate has been decreasing steadily. Still, the Federal Reserve is predicting that unemployment will hover around 5.5% in 2021.

A higher rate of joblessness would seem to work in an employer’s favor. After all, with fewer people employed, the pool of qualified applicants for any job should be stronger. 

However, employers for engineering and IT positions are in a unique and unfortunate situation. While it is true that some employers may have restructured and trimmed their workforce in 2020, freeing up talent to apply for other jobs, these fields have historically struggled to fill available positions.

While the overall unemployment rate is 7.9% at the time of writing, it is only 3.4% in the engineering sector and 3.5% in the IT sector. And, despite the overall surge in unemployment, these two fields saw little change in the face of the pandemic. The unemployment rate grew by only 1.1% overall for IT specialists between 2019 and 2020, and 1.2% for engineering professionals. Several factors indicate that these low unemployment rates will continue to hold for these sectors.

Growth was already projected in the engineering and IT job markets until at least 2027. But as the world adapts to living in the midst of a pandemic, technology has surged in importance, creating more new jobs. Additionally, the current administration has adopted an increasingly isolationist policy, effectively curtailing the immigration of skilled and educated workers. All this means that the Tech Dilemma—too many jobs and not enough workers—is becoming more firmly entrenched. Employers will need to hustle to attract and retain the best workers.

Growth Expected to Surge in IT and Engineering Sectors

Prior to the emergence of the novel coronavirus, it was projected that the STEM job sector would see overall growth between 2017 and 2027. Specifically, the Education Commission of the States predicted that the employment growth rate would be 14% for IT and 7% for engineering. 

As the world shifts to adapt to the pandemic, those projections are likely no longer exact. Still, continued growth in these fields is a given. Engineering and IT specialists have important, emerging roles to play in our current reality. 

As a September, 2020 news release explains, an ecommerce boom was created by the massive shift to online shopping and services. Many top tech companies are struggling to meet that ecommerce demand. Amazon is planning to hire 33,000 new corporate and tech employees. Facebook is hoping to fill 10,000 new product and engineering positions by the end of 2020. And while no numbers were provided by Netflix, the company has no plans to curtail hiring during the pandemic. 

The pandemic has also created more work related to the management of human health. Engineers, in particular:

  • Contributed to the sequencing of the genetic structure of SARS-CoV-2;
  • Assist with scaling-up production of therapeutics and vaccines;
  • Maintain the integrity of the supply chain by making sure equipment and chemicals arrive safely at their destinations;
  • Develop needed new medical technology, such as updated ventilators and handheld coronavirus scanners;
  • Create Personal Protective Equipment (PPE); and
  • Model the pandemic spread.

It’s quite clear that the pandemic has created new, complex demands that can only be met by a highly skilled IT and engineering workforce. Even in the face of job losses due to the pandemic, the need for IT and engineering talent will continue to grow.

Global Shift to Working Remotely

As employees in many sectors of the economy began working remotely, business took note of the possibilities. In July, Mark Zuckerberg promised that, by 2030, half of Facebook’s employees would be working from home. In order to do their jobs, those employees will need all levels of IT support. They also need access to the platforms developed by engineers, like broadband, wireless communication, 5G, and Zoom. 

If some employees are going to continue to work from home once a vaccine is found—and it seems likely that they will—the IT and engineering positions that rapidly emerged to support that work will become a permanent part of the job pool.

Lower Immigration Numbers

Historically, the United States has shored up its low number of STEM graduates through immigration. A study that focused on 2015-17 found that 30% of STEM jobs that required a  bachelor’s degree or higher were held by immigrants. In some specific sectors, that share was even higher: immigrants held a whopping 60% of STEM jobs that required a doctoral degree in engineering. 

However, the United States has moved towards an isolationist policy in the last few years, with a focus on buying American-made products and hiring American workers. As part of this policy, restrictions on H-1B visas have increased and, as a result, the number of immigrants qualified to fill job openings in the IT and engineering sectors has decreased. 

Without a strong pool of highly-qualified immigrant talent, American businesses that require IT and engineering specialists simply won’t be able to fill all their job openings. 

Too Many Jobs, Not Enough Workers

Even before the pandemic, it was estimated that there will be 3.5 million STEM jobs in the United States by 2025, but fully 2 million of those jobs will be left unfilled due to the lack of qualified candidates.

The large number of unfilled jobs means that those who are qualified to hold them will have a clear advantage in seeking meaningful work. The pandemic is not likely to change this scenario. Continued job growth and a global shift in the way all work is performed, along with lower immigration numbers, all coalesce into a serious shortage of qualified specialists in the IT and engineering fields.

A government report on employment issues within the STEM field states that: “STEM-educated individuals are not likely to be at a disadvantage relative to others in a post-COVID-19 labour market, and they may in fact be in a relatively advantageous position.” Employers will need to be creative in order to find and retain highly-qualified workers in these fields.

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