The labour market is changing. Whilst workers in tech play a major role in driving this change – by developing and promoting the technology that is adopted across other organisations - new research from the National Foundation For Educational Research (NFER) suggests the tech workforce itself is also undergoing rapid change.

Our analysis suggests there are half as many ads for jobs in tech occupations than there were before the pandemic. Ads for some key jobs – most notably software developers and programmers – are down by two-thirds since 2022. This raises important questions about the consequences of trends in tech hiring for economic growth, people already working in tech roles, young people looking to get into the labour market, and diversity within the tech workforce.

In this blog, Luke Bocock and Michael Scott from NFER discuss key findings from new research for The Hg Foundation on tech hiring trends. This represents the first in a suite of reports that will be published throughout 2025.

Please share your reflections on our report by responding to the questions at the bottom of this page.

Adverts for tech jobs in the UK have fallen sharply.

The UK tech sector is a vital part of the UK economy and jobs in tech have been widely anticipated to play starring roles in the government’s mission to stimulate economic growth. However, recent data casts doubt that this will happen.

Job adverts have been falling sharply across the UK labour market since 2022, with rising inflation and interest rates frequently cited as reasons why employers’ desire to hire has cooled. However, our analysis also suggests the decline in tech job advertisements has been relatively sharper than the decline in non-tech jobs since 2022, as shown in the chart below.

Volumes of job adverts in tech occupations and non-tech occupations

Demand for software developers in the UK has declined sharply in recent years  

Jobs in software development and programming have been hit particularly badly. Software jobs typically make up a large part of the demand for UK tech workers but their share of tech hiring has declined. In 2021/22, which we use a post-pandemic baseline, there were around 40,000 live adverts for software development jobs each week. As of November, the 2024/25 average is 14,000 adverts each week, a decline of almost 70%.

This decline in demand for new hires has also filtered through to a decline in the number of people employed in software development roles. In recent ONS figures, 530,000 people were employed in software development jobs in the UK as of around April 2024. This is down from a peak of around 600,000 in the middle of 2023, reversing a trend of almost non-stop, long-term growth.

This data raises an important question; ‘what is driving the rapid decline in demand for these types of tech roles?’ Beyond the challenging macroeconomic climate, anecdotal feedback from workers in tech sectors identify two additional factors, specific to these types of jobs:

1.    Firstly, many employers are ‘right-shoring’; moving IT work away from the UK to other countries where it can be delivered more cheaply.

2.    Secondly, the rapid adoption of Artificial Intelligence is starting to have an impact with AI tools already able to do many of the tasks done by junior developers. Even where tasks have not yet been automated, the anticipated role of AI is giving employers reasons to pause before putting adverts out to the market.

This is not to say it is all bad news; voices in tech stressed the need for developers with specialist skills, like AI. Adverts for most types of engineering (apart from software), as well as roles in science and research, have also held up relatively well since 2022. If current trends continue, there will be some areas of growing demand for young people looking to enter the tech workforce, but there will be fewer opportunities overall.

Young people may increasingly struggle to access jobs in the tech workforce.

What might these trends mean for young people looking to enter tech roles?

Our report suggests young people today are facing greater barriers to entering, or progressing into, the tech workforce than they did five years ago. Software development vacancies are increasingly likely to be for senior hires, with junior roles decreasing as a proportion of overall adverts. Qualification requirements are also rising; as the number of tech job adverts has declined, the share of these jobs that list qualification requirements has increased. This is happening faster in tech roles than other areas, and tech roles already tend to require higher levels of qualifications than most other occupations.

Those that can overcome these barriers are likely to require a combination of specialist skills in growth areas – for example data science – and broader commercial, project management and transferable skills. Other skill areas – such as programming languages, web design and databases – appear to becoming less important than they once were. This creates challenges that the education system needs to respond to if it wants young people to be equipped to compete for the available roles in tech.

Tell us what you think.

In summary, hiring in tech – widely considered to be key to the UK economy’s prospects for growth and the creation of high paying jobs - is faltering. Since 2022, there has been a disproportionately large fall in adverts for tech jobs in the UK, with software development and programming vacancies particularly affected. More tech roles are being advertised at a senior level or with explicit qualification requirements, posing additional obstacles for young people looking to get their foot in the door.

NFER will be working with The Hg Foundation throughout 2025 to examine changes in tech hiring and what they might mean for educational pathways into tech and for social mobility and diversity in the tech workforce

Please share your perspectives on the causes and consequences of these trends, and what you think is going to happen next (it will just take about 5 minutes):