Israeli high-tech is an exclusive club

Ra'anana high-tech park

The friends-bring-friends hiring method in Israel's tech industry aggravates its severe talent shortage. Diversity is the key.

On the Ayalon Highway is a giant sign calling on people to work at a well-known large technology company. There is no doubt that this sign is designed to exude some kind of prestige. This billboard symbolizes the war in the technology industry over every experienced engineer and programmer. Every year, there is a shortage of tens of thousands of employees to fill available technology jobs, the number of which is continually increasing as the startup nation gets stronger.

At the same time, the technology sector has always been an exclusive members club, and still is. You leaders of technology companies - isn't this a shame? After all, you have a problem and the demand for employees is only increasing.

In order to illustrate the point, I will focus on the perspective of an engineer entering the labor market. What is the most important thing that engineers who have completed their studies need in order to get a job interview? Is it the academic institution at which they studied, or the high grades they received? No, the most important and critical thing to have is a friend, or a friend of a friend, who works at one of the technology companies and is willing to recommend them to the personnel department, or to his or her direct manager. Without such a recommendation, the chances of getting an interview for a technology job are very poor.

Over 50% of the candidates for technology jobs in technology companies in Israel are currently selected through word of mouth. Technology companies are thoroughly convinced that this is the best model for hiring, and many of them have therefore created very attractive programs to encourage their employees to recommend their friends. In effect, the technology companies are turning their employees into personnel agencies, and are giving them thousands of shekels in bonuses and gifts for doing this.

But is this really the most effective method of building an enterprise that aspires to creativity and efficiency? Many company managers argue that the "duplication" method is advantageous. They take a group of employees who studied or served in the army together. Most of them are usually secular Jewish men of similar age, so it will probably be easy for them to work together. When they need more people, they will simply find people similar to them with the same profile, and then their integration will be quick and easy. But does this uniformity generate more effectiveness and creativity?

As a technology entrepreneur and employee in the technology industry for the past 30 years, my experience indicates otherwise. Does anyone really believe that if we take similar people with a similar background, we can get more diverse and effective thinking than with a combination of people from different backgrounds? Of course not. Including people from different backgrounds will lead to different thinking outside the box, which will bolster creativity and encourage the unique solutions that the company wants to achieve.

There is another reason, however, for diversity besides creativity. The technology market currently lacks 15,000 employees in technology jobs. Since all of the companies are trying to hire people with the same hiring profile, it is becoming more and more difficult to find employees. Companies that make diversity a key part of their growth considerations, or, in other words, open the club to outsiders, will be much more effective in finding high-quality personnel. The most effective tool in achieving this goal is help from entities and organizations specializing in finding talented engineers currently excluded from the technology market and integrating them in a company in the long term.

There is no doubt that the biggest barrier to continued growth of the technology industry is the ability to fill technology jobs with talents from Israeli society, which also contains Arabs, haredim (ultra-Orthodox Jews), and women. The challenge is finding them when they have no strong networking system. Overcoming this barrier requires realization by technology executives that they have to lead a major change in their hiring method that will diversify the human mix in the companies that they are leading. They have to set clear hiring targets and integrate talents from the diverse population groups in Israel.

The author is an entrepreneur who invests in startups and co-CEO of itworks, a non-profit organization that strives for employment diversity in the Israeli technology industry.

Published by Globes, Israel business news - en.globes.co.il - on August 20, 2020 © Copyright of Globes Publisher Itonut (1983) Ltd. 2020

Ra'anana high-tech park
Ra'anana high-tech park
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