The shortage of tech talent is causing huge economic losses for organizations, but artificial intelligence could offer a partial solution.
A recent market research conducted by IDC has revealed that the lack of technology skills will cost organizations 5 trillion euros by the year 2026. This alarming forecast is based on a survey of 811 IT leaders from companies in the US and Canada, who indicated that losses will stem from product delays, inability to compete, and loss of business.
The skills gap in IT operations, cloud architecture, data management, and software development has led to digital transformation delays of up to 10 months for nearly two-thirds of the surveyed organizations, according to the report.
Despite the severity of the problem, generative artificial intelligence capabilities are starting to fill some of these gaps, according to Gina Smith, IDC’s research director for digital business IT skills. The firm has reduced 900 billion euros from its original estimate of 5.85 trillion euros in revenue losses, forecasted two years ago, thanks to “coding technologies with AI, personalized learning, and other enhancements.”
A Growing Problem
In the ongoing struggle to eliminate technical debt, modernize systems, and use IT to drive growth, acquiring the necessary skills has become a perennial headache. IDC expects 9 out of 10 organizations to feel the pressure by 2026.
Talent issues have escalated over the past decade, noted Smith, referring to IDC’s survey data. “What is different now is the accelerated pace of new technologies,” Smith said. “IT leaders have always had trouble keeping employees up to date. Now the pressure is even greater.”
The impacts of a tech personnel crisis can affect the entire organization. More than 3 out of 5 respondents said that skills gaps resulted in product delivery delays and missed revenue targets. Nearly the same amount reported quality issues and customer satisfaction deficiencies due to IT talent shortages.
The Role of Generative AI
The rush to deploy emerging capabilities of large language models has only exacerbated the problem. AI skills are now the most valued and hardest-to-obtain IT skill set, cited by 45% of respondents.
With a technologist unemployment rate below 3%, organizations are responding to the challenge with training initiatives and using generative AI in the process.
More than half of the respondents reported that their organization was in a pilot phase or full deployment mode with AI-assisted skills enhancement initiatives. But 41% said that their organization had no such plans.
Currently, technology is most commonly used to analyze skills assessment data, update existing training protocols, and create new courses, according to the report. But generative AI can also help improve some of the skills enhancement strategies that IDC describes as most effective, such as gamified training modules and practical labs.
Coding tools with AI will also mitigate some of the damage caused by talent deficiencies. “While IDC sees the current IT skills shortage expanding in severity and scope, we believe that AI technologies will reduce around 900 billion euros of the skills shortage impact by 2027,” stated Smith.