The tech talent shortage: Intensified by global disruptions

The sharp increase in demand for digital services in the last decade has created a gap in supply and demand for digital talents wherein the latter significantly exceeds the former. In the EU alone, McKinsey & Company projects a talent gap between 1.4 to 3.9 billion people by 2027 [1]. Hotspots like AI are experiencing an even greater gap as demand for AI capabilities surges in the past few years. Bain & Company estimated that while AI-related job postings increased by 21% annually between 2019 – 2024, supply of talents has yet to keep up. And this mismatch leaves jobs unfilled in nearly all markets. It is estimated that by 2027, 1 in 2 AI-related roles will be left unfilled in the US, the UK and India while for Germany, the gap stands at a higher rate of 70% [2]. 

Consequently, businesses are experiencing the hardship of attracting digital talents, with 80% of surveyed organizations encountering a shortage of tech experts [3]. Unfortunately, rising global disruptions are expected to add more challenges. Immigration-related concerns in developed economies such as the UK, the US, and Australia could lead to tightening regulations, reduced mobility of talents, and rising costs of onboarding foreign employees. For instance, the US government recently raised the fee of H-1B visa, asking companies to pay US$100,000 annually per foreign worker they seek to employ [4]. This leaves companies in these markets, whose demand for digital talents remain one of the highest globally, face even greater challenges in building in-house workforce. Meanwhile, instability in other regions, from political tensions between Thailand and Cambodia or Russia and Ukraine to unrest in Nepal, Indonesia, and the Philippines, further complicates the situation. These social unrests disrupt day-to-day businesses and services provided by digital workers residing in these areas. 

Implications for businesses: Geographical diversification is vital

Concentrating talents in one location, either local or offshore, exposes businesses to certain risks and potentially disrupt operations. Diversifying hiring hubs not only reduces such dependencies but also opens up companies to a larger talent pool, consequently improving business resilience, agility, and innovation. Worldwide businesses are already embracing this approach, with 78% of surveyed APAC companies planning to hire remote employees for more than 60% of full-time jobs [5]. While traditional markets such as China and India have been actively sought after for talents, especially in the field of technology, rising markets including Vietnam have emerged as a destination for digital talents. Indeed, hiring of Vietnamese top talents, especially in the tech sector, has risen by 111% in 2024, according to an industry report [6]. Boasting a workforce of over 1.2 million ICT workers and 74,000 technology firms as of 2024, the country is attracting attention not only as a talent hub but also as a destination for high-tech innovation and development. Indeed, the country was ranked 1st globally in high-tech exports, creative goods exports, and high-tech imports in the WIPO’s Global Innovation Index 2024 report [7]. 

Strong economic growth and geopolitical stability have set Vietnam up as a popular destination for investment. Averaging 7.0% in annual economic growth rate since 1990 [8], Vietnam is forecasted to remain in the top 25 economy globally in the next decade [9]. The country has established free trade agreements with over 60 economies and form comprehensive strategic partnerships with 13 powerhouses including the US, China, South Korea, Russia, Japan, and more. Vietnam remains among top 15 countries worldwide in attracting FDI and has been increasingly chosen as an innovation hub by companies globally [10]. Some notable projects include NVIDIA’s AI R&D center and AI data center in collaboration with the Vietnamese government, Qualcomm’s 3rd largest AI R&D center globally, and Samsung’s largest R&D center in Southeast Asia. 

Geographical diversification strategies, such as hiring remote workers, establishing overseas development centers, and partnering with foreign service providers, hold significant potential to mitigate risks from global disruptions. However, these approaches are not without challenges. Hiring remote talent, for instance, introduces regulatory complexities, with 46% of APAC business leaders citing differences in labor laws across countries as the biggest obstacle to managing distributed teams [5]. While alternatives like setting up overseas development centers can address this issue, they demand substantial upfront investment. Likewise, working with multiple regional service providers can ease talent shortages but often creates difficulties in vendor management, system integration, and higher administrative costs.

Best-shore delivery model: Diversify without compromising

Companies have long come to a conclusion that relying on local workforce is both insufficient and risky, yet, diversifying hiring hubs through recruiting remote workers, setting up oversea offices or partnering with foreign service providers come with their own sets of challenges. While combining these strategies’ pros and eliminating the cons seems impossible, the best-shore delivery model offers exactly that. The method is FPT’s unique delivery model that combines the distinct advantages of onshore, nearshore, and offshore centers.

• Onshore:Local experts in markets such as the US, Europe, and Japan handle close collaboration with businesses, provide consultation, and end-to-end oversee the project with clear communication, tight delivery timeline, and cultural alignment. 
• Nearshore:Developers in neighboring markets such as Latin America and Slovakia take advantage of similar time zones to closely communicate with onshore centers for project clarification, participate in the agile development methodology to prioritize tasks and provide incremental software releases
• Offshore:Engineers in markets such as Vietnam and India provide specialized expertise to deliver quality and tailored solutions. These markets leverage time zone differences with onshore and nearshore centers to offer round-the-clock support and accelerated delivery. 

With a network of 88 offices in 30+ countries & territories, FPT helps businesses access a large pool of highly-qualified talents across the globe, allowing them to diversify without compromising on costs and operational efficiency. Offering comprehensive end-to-end services, which is strengthened by partnerships with global organizations such as NVIDIA, Microsoft, SAP, and more, FPT has helped global companies leverage the global workforce at the convenience of vendor consolidation, ultimately optimizing administrative costs and improving system performance. With its best-shore delivery model, the company has empowered 1,100+ enterprises worldwide, including 130+ Fortune 500 companies, to achieve their digital transformation ambitions.

Learn more about FPT’s best shore delivery model here.