Software Programmer Or Coder Woman Using Office Computer

More than half (54%) of tech leaders report that skills shortages are preventing their company from keeping up with changes, according to the 25th annual Digital Leadership Report from Nash Squared, but this measure is down from 70% last year. The new report, based on responses from over 2,000 senior technology decision-makers in 86 countries, found that data engineering, enterprise architecture, technical architecture, software engineering, and AI make up the top five most in-demand skills. 

Down from 58% in 2022, half (50%) of tech leaders expect their IT/tech headcount to increase over the next 12 months. Within three key areas — cybersecurity, software engineering, and data — most (at least 40%) plan to increase their headcount through permanent hires, while roughly 30% plan to outsource. Less than 25% plan to hire consultants or contractors.

Tapping into the potential of generative AI

Not surprisingly, much of the focus for tech leaders has been on generative AI. Although only 10% of respondents said their company has large-scale AI implementations, companies that are using AI and machine learning are seeing growth — 28% said it’s been one of their top two ROI-generating technologies over the past three years. 

Perhaps what’s slowing the adoption of generative AI is confusion surrounding how to effectively and responsibly harness its benefits. More than four in 10 (42% of) tech leaders said their organization isn’t prepared for generative AI. Only 15% of tech leaders said they’re “very” or “extremely” prepared. 

All but 12% of respondents agreed that AI should be more heavily regulated by government agencies, but most (61%) don’t believe such regulation will be effective. Only 21% said their company has its own AI policy, while 43% are making plans to implement a policy. However, despite the fact that most tech leaders (41%) listed regulation among their top two AI concerns, 70% believe AI’s potential benefits outweigh its risks.

In-office policies impact female representation in tech

Most organizations are taking a hybrid approach to work and requiring employees to be physically in the office 2 days (36%) or 3 days a week (37%). And the majority of tech leaders (82%) report that their in-office policy is working well. Respondents said the most common objection to working in the office was the time spent commuting (67%).

Another common complaint was difficulty managing caregiving responsibilities (30%). Given that many female office workers are caregivers, this makes in-office policies a barrier for women in tech. 

Women made up just 14% of the tech leaders who participated in the survey this year. When asked about the proportion of females on their tech team, the global average was only 23% (27% in the U.S.). And within the past two years, only 27% of new tech hires were women (30% in the U.S.). 

Nash Squared’s research found that flexible work schedules play a notable role in female representation — there are 20% more females in tech teams that have minimal in-office policies (2 days or less per week), compared to those that require a full week in-office.