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Article | Beyond Data

3 talent and pay trends critical to your digital transformation

By James Walsh and Goldie Yuen | April 26, 2022

Your organization's digital transformation will continue even when the pandemic is over.
Compensation Strategy & Design|Work Transformation|Employee Experience
Beyond Data

The increased demands of remote work combined with broader digitalization of many services and products in the past few years have resulted in organizations fast tracking their digital transformation journeys. As markets continue to recover, businesses face new challenges that likely would have occurred regardless of health, political and environmental factors, but have been accelerated at an unexpected pace.

Specifically, organizations are facing a scarcity of talent with critical digital skills – the talent who will continue executing on digital transformation strategies. Ensuring employers have the right talent is as important as adopting the right technology. And to attract and retain that talent, those sorely needed skillsets must be at the core of every pay and talent strategy.

Insights from WTW’s most recent Artificial Intelligence and Digital Talent (AIDT) Survey and the global Reimagining Work and Rewards Survey reveal three trends critical for organizations to monitor and manage as they progress in their digital transformation. And this becomes particularly important as employers face a seller’s market for talent.

  1. 01

    Ongoing difficulty in finding and keeping digital talent

    For the past three years, an average of nine in 10 organizations have had difficulty attracting and retaining digital talent. And, with digital transformation rapidly advancing across industries and geographies, the market for digital talent is only expected to become increasingly tighter. Figure 1 shows the uphill climb organizations have had to attract and retain talent on the rise since 2020 – and there’s no near-term end in sight.

    Line graph showing the extent to which organizations have experienced problems attracting/retaining employees during 2020-2022
    Figure 1. The extent to which organizations have experienced problems attracting/retaining employees, 2020-2022

    Additionally, 78% of organizations are challenged to attract and retain talent with skills related to cyber security, artificial intelligence and machine learning, e-commerce, blockchain, and data science and business intelligence. With 84% of employers planning to increase or significantly increase the headcount of their digital talent teams, a strong Total Rewards strategy and employee experience will be make-or-break aspects in the highly competitive marketplace.

  2. 02

    More aggressive salary budgets

    Understandably, salary budgets took a hit at the height of the pandemic. Now, with recovery and stability kicking in, organizations are returning to pre-pandemic salary budget levels – but for better reasons than “that’s how we always did it before.”

    Nearly one-quarter of organizations have higher salary budget projections for 2022 than anticipated in mid-2021. Among the top reasons cited are the tight labor market (63%) and concerns related to cost management and inflation (48%). This indicates that organizations plan to leverage pay to compete in a tougher labor market.

    It also is important to remember that, when it comes to digital talent, employers aren’t only competing with industry peers. Being competitive means looking at different geographies as well as industries that may be more aggressive in their search for digital talent. Organizations must differentiate themselves to stand out as a digital-talent employer of choice. This naturally leads to our third trend.

  3. 03

    Differentiated rewards and new ways of work

    In the past three years, an average of six in 10 organizations have leveraged their rewards strategy to differentiate themselves in the talent marketplace. Prior to 2020, alternative and flexible working arrangements were the perennial differentiator, but the pandemic changed that.

    Today, flexible work arrangements no longer serve as the differentiator they once were. Instead, organizations are looking at how their flexible work arrangements function best, whether that be a remote-only situation or a hybrid variation. Additionally, programs like four-day workweeks are being considered to better support employee wellbeing objectives.

    Infographic showing 8% of employees worked remotely or a mix of remote and onsite work 3 years ago and that half of employees currently expect this to continue for at least the next three years
    Figure 2. Flexible work is no longer a differentiator

    With flexible work arrangements no longer a point of distinction, organizations are looking at enhancing base pay for digital talent (52%), dedicated career progression models (36%) and increased learning and development opportunities (33%).

  4. Rethink your approach to digital talent

    Digital transformation is an integral part of business survival, and you need the right talent to achieve that transformation. Finding and keeping the right people to do the right jobs at the right time requires a Total Rewards approach that is tightly tied to a business strategy that keeps these priorities at the forefront.

    As noted, most of the insights in this article are sourced from WTW’s Artificial Intelligence and Digital Talent Survey report, which collects data on skill identification, talent sourcing, job reconfiguration, modernizing Total Rewards for the digital workforce and much more. Organizations that participate in the Digital Transformation practices questionnaire – which is open for participation as of this writing – will receive a complimentary executive summary of the findings.


Director, Global Lead, AI and Digital Talent Survey, Rewards Data Intelligence
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Lead Associate, Rewards Data Intelligence
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