In the IT working world, the concept of New Work, or harmonizing work with freedom and independence, has long been established. IT specialists increasingly opt for independence and work as freelancers. Companies and government institutions that still want to rely exclusively on permanent IT staff are facing a growing problem with this development.

More and more frequently they cannot fill vacant positions for months due to a lack of suitable candidates. Companies have been complaining about this shortage of skilled workers in this context for decades. The integration of freelancers, when implemented correctly, can be a more than sensible alternative for many companies.Complaints regarding the shortage of IT specialists have no end. The number of apprentices and students in the IT sector worldwide has been increasing steadily for years. However, at least so far, this growth has not been able to keep up with the continuously growing demand in public services and in business. Not least because more and more highly qualified IT specialists are deciding to start their own businesses, and some companies have not yet adapted their recruiting to this new reality. The high demand for IT specialists in recent years has greatly increased the earnings prospects of IT freelancers and has significantly reduced the risk of becoming self-employed. Given the serious imbalance between demand and supply of IT specialists, this is a development which is seeing no end. It therefore makes sense for companies to adapt to this new situation.

German IT job market still under pressure

Around 802,000 IT professionals were employed on the German labor market in 2018, according to a recently published study of the German Federal Employment Agency (BA). The German Federal government has indeed launched numerous initiatives at schools and universities to combat the growing demand. 216,000 students were enrolled in the IT fields of study in 2017/18 – an increase of just over five percent compared to the previous year. In the short and medium term, however, we can hardly speak of any ease of tension in the German IT job market. Not least because the implementation of the ambitious digital strategies of large corporations and public institutions requires experienced specialists; the bottleneck here is still quite serious and cannot be covered in the short term by a pleasingly increasing number of IT graduates. A rapid alleviation of the tense situation can hardly be expected in the near future. For this reason, companies and public institutions have increasingly started adapting their recruitment strategy to employ freelancers on a project basis. Companies and public institutions are considering new developments in the labor market and opening up to a new, rapidly growing pool of IT specialists.

IT freelancers in Germany

Around half of German companies now rely on external professionals when it comes to implementing digital projects. Most of them are fully satisfied with the work of external professionals and want to further expand their participation in project work in the coming years. According to the BA study, quite a few of these external people, around 86,000, were self-employed in 2018. That is just over 10 percent of all IT professionals in Germany who are subject to social security contributions! These are primarily highly specialized experts. Most of them – around 65,000 – run a one-person operation. Their work priorities focus on software development, programming, and IT application consulting – in other words, the same exact working areas that are currently lacking permanent staff. A further increase is to be expected here in the years to come. This is because the freelance work model has much more to offer for IT specialists than just a good wage.

Free, confident, financially successful – the New ‘IT’ Work freelancer

Of course, a freelancer who has well-developed specialist knowledge in a specialized field can earn significantly more money than in a permanent position. The average hourly wage for IT specialists has long been nearing the 100-euro mark. However, it is often completely different criteria that drive IT professionals into self-employment. The keyword here is “New Work”. Almost half of IT specialists sacrifice their secure employment relationships to improve earnings. Although it seems that a desire for more independence is the real driving force. As a freelancer, you are your own boss and can choose your own project, place of work and working time. You gain freedom – a commodity that is enjoying rapidly growing popularity, especially in IT.

The freelancer as a bridge to more knowledge

For companies, this change does not have to mean anything bad if they face up to the new reality. If implemented correctly, a company can even benefit considerably from using a freelancer on a project basis. By involving a highly specialized technical freelancer, companies bring in expert skills, knowledge and experience that often rub off permanently on its own workforce. However, some adjustments are necessary to be able to implement such cooperation with the greatest possible efficiency, ranging from project integration to knowledge transfer.

Counter the change towards New (IT) Work in a structured manner

Companies need to act and not react if they do not want to be overwhelmed by this paradigm shift in the IT job market. We are not dealing with a fad here, but a sustainable trend that can be observed globally. Accordingly, your own capacities for projects must be analyzed in detail, and work processes and recruiting adapted so that the legal framework, internal compliance requirements and permanent employees are optimally prepared for the involvement of freelancers. Only then will the company be properly attuned to the freelance work model, able to start looking for the right freelance IT specialists and benefit fully from the know-how of top IT professionals.

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