The technology, media and gaming (TMG) sector continues to compete for digital talent
The technology, media and gaming (TMG) sector in the UK is competing for digital talent with industries such as financial services and retail, prompting the sector to become more competitive with their compensation offers amid a tough economic landscape. The country’s inflation rate reached just over 10% in 2022 but could dip to 6% in 2023. However, the strong GDP results for both 2021 and 2022 are projected to fall to -0.5% this year.
Our 2022 Inflation and Reward Actions Pulse Survey for Europe found that 78% of organisations in the UK are struggling to find digital talent (Figure 1). The challenge to source talent has become particularly difficult compared to 2021 in six digital skill areas (Figure 2). More than half of organisations say they find it difficult to hire for Data Science and Business Intelligence (66%), Artificial Intelligence & Machine Learning (65%), Digital Architecture (62%), Cybersecurity (59%), Cloud Computing (59%) and Application Development (58%).
Source: 2022 Inflation and Reward Actions Pulse Survey, Europe
Talent with digital skills – Great/moderate extent, 78%; Slight extent, 15%; Not at all, 7%. Non-management (professional) - Great/moderate extent, 62%; Slight extent, 30%; Not at all, 8%. Salaried employees - Great/moderate extent, 52%; Slight extent, 32%; Not at all, 16%. Sales positions - Great/moderate extent, 49%; Slight extent, 29%; Not at all, 22%. Managed (excluding executives) - Great/moderate extent, 46%; Slight extent, 39%; Not at all, 15%. Hourly employees - Great/moderate extent, 38%; Slight extent, 26%; Not at all, 37%. Executives - Great/moderate extent, 30%; Slight extent, 31%; Not at all, 38%.
Source: 2021 and 2022 Digital Transformation Practices Survey, United Kingdom
Data Sciences and Business intelligence – Increase, 66%; Stay the same, 33%; Decrease, 1%. Artificial Intelligence and Machine Learning – Increase, 65%; Stay the same, 35%; Decrease, 0%. Digital Architecture – Increase, 62%; Stay the same, 37%; Decrease, 1%. Cybersecurity – Increase, 59%; Stay the same, 40%; Decrease, 1%. Cloud Computing – Increase, 59%; Stay the same, 39%; Decrease, 2%. Application Development – Increase, 58%; Stay the same, 40%; Decrease, 1%.
To rise above the talent war, many organisations in the TMG sector have taken a holistic approach by leveraging the different components of compensation and aligning them to the value and needs of experienced digital talent.
The median base salary for information technology roles in the technology sector is 7% higher compared to other industries and it is 3% higher for roles in IT development specifically. Roles in HR, IT, Corporate Affairs and Customer Support within media organisations tend to receive a higher median base salary compared to other industries (Figure 3).
Source: 2022 WTW Compensation Surveys – United Kingdom
AIC – Information Technology – Base Salary 50th – Tech 7%; Media 8%; Financial Services -2%; Energy and Natural Resources -2%; Retail -4%; Pharma and Health Sciences -4%. AHR – Human Resources – Base Salary 50th – Tech 1%; Media 7%; Financial Services 1%; Energy and Natural Resources 0%; Retail -2%; Pharma and Health Sciences 0%. AID – IT Development – Base Salary 50th –Tech 3%; Media 13%; Financial Services -2%; Energy and Natural Resources -4%; Retail 4%; Pharma and Health Sciences -4%. ACA – Corporate Affairs/Communication – Base Salary 50th – Tech 4%; Media 6%; Financial Services -1%; Energy and Natural Resources 0%; Retail -2%; Pharma and Health Sciences 2%. AIT – IT Administration – Base Salary 50th – Tech 2%; Media 8%; Financial Services 6%; Energy and Natural Resources 3%; Retail 3%; Pharma and Health Sciences 2%. AIC – Information Technology – Base Salary 50th – Tech 4%; Media 7%; Financial Services 1%; Energy and Natural Resources 1%; Retail -2%; Pharma and Health Sciences 5%.
To attract the right talent, the TMG sector has raised new hire premiums for professional roles by 5% on average. The premium reaches up to 11% for those in the Master (P5) and Renowned Expert (P6) career levels. Functions that offer the highest premiums for new hires in the P3 career level include media programming and external project/program management (Figure 4). To ensure effective use of premiums in attracting the right talent, organisations can leverage compensation data and analytics to gain an accurate understanding of which digital skills they would need to thrive and pivot in the ever-changing landscape.
Media Programming (MPC) – 25% in 2021 and 21% in 2022. External Project/Program Management (TMP) – 10% in 2021 and 15% in 2022. Media Business Affairs (MBL) – -5% in 2021 and 12% in 2022. Technology Systems Consulting (TCT) – 9% in 2021 and 10% in 2022. Human Resources (AHR) – 12% in 2021 and 10% in 2022. General Management and Administration (AGA) – 11% in 2021 and 10% in 2022. Technical Customer Support (AMT) – 1% in 2021 and 9% in 2022. Technology Product Development (TPD) – 14% in 2021 and 8% in 2022. Business Consulting (TCB) – 8% in 2021 and 7% in 2022. IT Administration (AIT) – 5% in 2021 and 7% in 2022.
Additionally, the TMG sector increased salaries for very hot digital roles (Figure 5), driven especially by the high demand for technologies that support the growing transition to remote or hybrid working. This includes roles in internet/web application development, which saw a 31% increase in their median base salary in the past year. Meanwhile, roles in cloud computing architecture received a 29% increase in their median base salary.
31% – Internet or web application development. 29% – Cloud Computing Architecture. 28% – Contract Law. 27% – Corporate or Company Secretary. 27% – Information Technology Generalist and multi-discipline.
LTI offerings in the TMG sector tend to provide a greater return for employees in professional roles compared to other sectors. Although LTI eligibility levels tend to be lower than most industries (except for financial services), LTI often takes up a higher proportion of the overall pay mix as a percentage of base salary for qualified employees, particularly for those in P3 and P4 career levels where LTI is typically not offered. LTI percentage averages at 31% for P3 and 34% for P4 levels, which are higher compared to other industries (Figure 6). This trend is mostly evident among US-headquartered companies, which typically offer LTIs more often than companies headquartered elsewhere.
P3 – Career. Financial Services – Long term incentives 18%; Actual Annual Incentives 7%; Total Guaranteed Compensation 75%. Energy – Long term incentives 11%; Actual Annual Incentives 4%; Total Guaranteed Compensation 85%. Fintech – Long term incentives 38%; Actual Annual Incentives 6%; Total Guaranteed Compensation 56%. Tech, Media, and Gaming – Long term incentives 31%; Actual Annual Incentives 5%; Total Guaranteed Compensation 64%. Pharma – Long term incentives 5%; Actual Annual Incentives 11%; Total Guaranteed Compensation 84%. Retail – Long term incentives 39%; Actual Annual Incentives 5%; Total Guaranteed Compensation 56%. General Industry – Long term incentives 22%; Actual Annual Incentives 7%; Total Guaranteed Compensation 72%.
P4 – Specialist. Financial Services – Long term incentives 17%; Actual Annual Incentives 9%; Total Guaranteed Compensation 74%. Energy – Long term incentives 9%; Actual Annual Incentives 9%; Total Guaranteed Compensation 81%. Fintech – Long term incentives 28%; Actual Annual Incentives 8%; Total Guaranteed Compensation 60%. Tech, Media, and Gaming – Long term incentives 31%; Actual Annual Incentives 5%; Total Guaranteed Compensation 79%. Pharma – Long term incentives 33%; Actual Annual Incentives 6%; Total Guaranteed Compensation 79%. Retail – Long term incentives 33%; Actual Annual Incentives 6%; Total Guaranteed Compensation 61%. General Industry – Long term incentives 15%; Actual Annual Incentives 9%; Total Guaranteed Compensation 76%.
M3 – Senior. Financial Services – Long term incentives 18%; Actual Annual Incentives 12%; Total Guaranteed Compensation 70%. Energy – Long term incentives 12%; Actual Annual Incentives 12%; Total Guaranteed Compensation 78%. Fintech – Long term incentives 26%; Actual Annual Incentives 10%; Total Guaranteed Compensation 64%. Tech, Media, and Gaming – Long term incentives 20%; Actual Annual Incentives 11%; Total Guaranteed Compensation 69%. Pharma – Long term incentives 11%; Actual Annual Incentives 15%; Total Guaranteed Compensation 74%. Retail – Long term incentives 23%; Actual Annual Incentives 13%; Total Guaranteed Compensation 64%. General Industry – Long term incentives 12%; Actual Annual Incentives 13%; Total Guaranteed Compensation 75%.
M5/M4 – Senior Group Manager or Group Manager. Financial Services – Long term incentives 17%; Actual Annual Incentives 25%; Total Guaranteed Compensation 58%. Energy – Long term incentives 16%; Actual Annual Incentives 21%; Total Guaranteed Compensation 63%. Fintech – Long term incentives 26%; Actual Annual Incentives 10%; Total Guaranteed Compensation 54%. Tech, Media, and Gaming – Long term incentives 27%; Actual Annual Incentives 15%; Total Guaranteed Compensation 58%. Pharma – Long term incentives 17%; Actual Annual Incentives 20%; Total Guaranteed Compensation 63%. Retail – Long term incentives 33%; Actual Annual Incentives 14%; Total Guaranteed Compensation 53%. General Industry – Long term incentives 21%; Actual Annual Incentives 17%; Total Guaranteed Compensation 62%.
Foundational to these strategies is a strong understanding of the specific skills required by your unique business operations and goals, alongside an awareness of what will inspire the right talent to join and grow with your organisation. To further maximise your investment in talent, look into tools that will help you gain insights into how skills affect pay and be informed of the market best practices for rewarding critical talent effectively.
