In this month’s Baer State of the IT Labor Market Report, we’re comparing Q1 2023 and Q1 2024 market trends. While 2023 was a steady market, as anticipated, 2024 is becoming increasingly competitive. At Baer, we’ve seen a 26% YoY increase in aggregate service request volume in Q1 2024 over Q1 2023, with a 40% increase coming from the Federal sector and 22% coming from systems integrators. Service volume requests direct from the commercial market remain steady.

There are three key technology platforms driving this uptick: we’re seeing a 17% increase in requests for SAP expertise, as well as notable increases in requests for Oracle and Salesforce expertise.

Breaking Down the Data: SAP S/4HANA Staffing Insights for the Commercial Enterprise Market

The message in the data is clear—the market is on the move. A 22% increase in overall requests for talent from SIs coupled with a 17% increase in requests for SAP talent specifically, are strong indicators that the commercial enterprise is once again investing in SAP S/4HANA innovation. SAP’s own 2024 Q1 financial results support this with cloud revenue up 24%. Further, with all indicators pointing toward these trends continuing in 2024 Q2, we can anticipate an increasingly competitive SAP labor market as the year continues.

Following are potential market impacts:

• Parallel Federal investments driving labor compression – To have the Federal government investing in parallel with the commercial enterprise is unprecedented, and likely to drive labor compression. This may be further exacerbated as ongoing turbulence and layoffs in the tech sector, the relative stability of the pay scale increases by the public sector. As one Wired writer put it, “the government is the hottest tech employer in town.”
  
  
• SIs becoming resource constrained – S/4HANA customers that are relying on their SI to supply the bulk of the talent for their initiative should be aware that SIs have finite resources. As the commercial enterprise ramps up investment, the talent simply may not be available when needed, making it challenging for SIs to fulfill their commitments. Further, your internal HR team or traditional IT staffing partner may not have the expertise to fill the void.

• Labor compression will make it a sellers’ market – When competition for talent increases, salaries typically increase as well. Top-tier talent that hasn’t been lost to the Federal market will be jockeying to work on the most compelling initiatives and with the best employers—and they’ll be asking top dollar. All S/4HANA initiatives benefit from continuity in staffing,

To minimize risk, organizations would be well served by proactively establishing a relationship with an enterprise performance partner who knows the technology and market well, has established relationships with proven talent, and can access hidden or off-market expertise.

If you are interested in market insights and salary data to help you make informed decisions about your S/4HANA or other digital transformation, contact btrout@baergroup.com.

About Baer

Unlike typical technology staffing companies, Baer is a true enterprise performance partner. We have a deep understanding of the scope of enterprise digital transformation and the highly specialized skillsets you will need at different stages of the process.

To learn more about how Baer can make a positive impact on your enterprise transformation, please reach out to Brian Trout, Executive Vice President, Sales, at btrout@baergroup.com, or John Wilson, Vice President of Strategic Accounts, at jwilson@baergroup.com.