The removal of tax incentives in the IT sector is exacerbating an already felt labor market crisis

2023 has been a challenging year for the IT sector, both globally and especially in Romania. On the one hand, significant layoffs in the early part of the year left many candidates searching for jobs in a market with increasingly high demands. On the other hand, the taxation of incomes over 10,000 lei gross, a measure expected to be implemented this autumn, puts pressure on recruitment and may lead employers to lean towards younger candidates who fall within the non-taxable salary limit.

The number of IT jobs available on the bestjobs recruitment platform has remained at the January level, while the number of candidate applications registered in the last month is 15% higher than at the beginning of the year.

In the IT sector, there are still specializations for which finding suitable candidates remains a challenge. These are usually related to new or developing technologies, such as automation, Artificial Intelligence, or cybersecurity, for which salary offers are well above the market average. For example, a Cybersecurity Engineer can earn between 1,500 and 2,300 euros net, a Data Security Officer between 1,000 and 1,500 euros net, and an Automation QA Engineer between 1,900 and 2,500 euros net, according to bestjobs data. Moreover, most IT employees, especially those in programming whose salaries exceed 10,000 lei gross, can consider other types of contracts that offer more advantages, such as collaboration through PFA (Authorized Physical Person) or micro-enterprise.

On the other hand, the efforts of major IT companies to adjust the number of employees recruited during the pandemic to the current workload have resulted in massive layoffs in this sector, which began at the end of 2022 and still have an impact on the labor market. Many candidates are still available after long periods of searching, and in the context of the removal of tax incentives, they will need to significantly reduce their financial expectations.

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“After many years in which the IT sector faced a major shortage of specialists, despite high salary offers, this year there is a shift in the balance of power between employers and candidates, with the advantage shifting to employers. However, some specializations are doing better than others, but in terms of recruitment, there is increasing tension, as some candidates have difficulties in quickly finding a suitable job,” says Ana Vișian, Marketing Manager at bestjobs.