Turning IT Talent Shortage Into Opportunities with Staff Augmentation
Technology is an integral part of Singapore’s business development. Attesting to this is the country’s Smart Nation initiative, a nationwide effort that has created – and continues to create – technological developments across multiple sectors, leading to significant demand for IT professionals in AI, machine learning, cybersecurity, and data analytics, among others.
But despite the growing need for these skills, the tech scene faces a competitive business landscape that has led to a talent shortage. The 2025 Global Talent Shortage report ranks Singapore as the fourth highest globally in talent scarcity, with 83% of businesses struggling to find qualified professionals.
For businesses looking to jumpstart their digital transformation journey, this talent crunch becomes a hindrance. To address this challenge, this blog will provide context on Singapore’s current IT talent landscape and what businesses should do to address the IT talent shortage.
The Demand for IT Talent in Singapore
Singapore’s Digital Economy (DE) highly contributes to the country’s GDP, underscoring the importance of digitalisation. According to the Infocomm Media Development Authority’s Singapore Digital Economy Report 2024, the country’s DE, which is assessed by its economic contribution and notable changes over time, maintained its importance with a value-add of S$113.2 billion in 2023, accounting for 17.7% of the GDP. The information and communications sector contributed about one-third of this value, while the remaining two-thirds resulted from digitalisation in other sectors.
Similarly, the Digital Economy Report found that 94.6% of Singaporean companies integrated at least one digital aspect into their operations, with 44% specifically adopting AI technologies. This widespread digital adoption reflects the country’s commitment to leveraging technology for business efficiency and innovation.
Small-to-medium enterprises (SMEs) also showed substantial progress in digital transformation. The adoption of digital solutions among SMEs rose to 82% in 2023, up from 69% in the previous year. This increase highlights the growing recognition of digital tools’ importance in enhancing competitiveness and operational efficiency.
These trends underscore Singapore’s developing digital economy and its proactive approach to integrating advanced technologies across various business sectors. Singapore’s tech workforce comprises approximately 163,000 professionals across various industries, based on the latest data. With the ongoing digitalisation efforts, the demand for IT talent is expected to rise significantly.
Servicenow projects that by 2028, Singapore will require an additional 41,000 tech jobs to meet these growing needs. This anticipated increase underscores the importance of developing an effective pipeline of skilled IT professionals to support Singapore’s digital economy.
The Challenge: Tough Competition and Skills Gap
Despite the pressing need to implement tech innovations across businesses, Singapore struggles to hire the best-fit IT talent. Skills mismatch is one of the significant challenges in today’s recruitment landscape, according to Randstad. But more alarmingly, the continuous development of digital technologies could further widen the gap between talent skills and industry needs.
Case in point: The 2024 IT Skills and Salary report reveals that 45% of IT decision-makers in Singapore identify skill gaps as a barrier to increasing their talent pool. A significant factor contributing to this talent shortage in the IT industry is the reluctance of employees to reskill. Only 53% of local talent are willing to reskill to stay relevant in the AI era, and 40% remain unfamiliar with the capabilities of generative AI.
This skills gap is further supported by high employee turnover, with 40% of tech industry employees considering switching companies and high salary expectations. In fact, in Singapore, 43% of professionals prioritise salary when considering job changes, making it difficult for companies to attract and retain top IT talent as they must compete with higher salary offers from other employers.
Organisations Respond to IT Talent Crunch
Addressing business needs in the technology sector is a vital priority for business leaders. They must consider both the workforce and current technological demands. According to the Digital Leadership Report by Nashsquared, 67% of senior technology leaders acknowledge that their companies are falling behind due to a lack of skills in new technologies, exacerbating the IT talent shortage.
The Randstad report indicates that in 2025, 38% of organisations plan to increase their budgets for technical roles, and 30% will focus on internal promotions. However, three out of five employers anticipate that tightening corporate budgets will pose a challenge to achieving these goals.
While reskilling existing talent is an option, it has its drawbacks. Reskilling takes time, and according to Harvard Business Review, the average half-life of skills is now less than five years. Given this, reskilling alone may not be sufficient to meet immediate needs. For businesses requiring immediate expertise, IT staff augmentation is a viable solution.
Combat IT Talent Shortage with Staff Augmentation
IT staff augmentation is the approach where skilled professionals are brought in to fill specific roles within an organisation or business. This process involves identifying talents based on their expertise and the specific skills required for their projects. These professionals are then briefed to align with the organisation’s needs and objectives, ensuring they can effectively contribute to the team’s success.
IT staff augmentation addresses several pressing issues, such as:
Flexibility and scalability. Through IT staff augmentation, companies can quickly scale their teams based on project requirements and workload fluctuations.
Access to specialised skills. IT staff augmentation helps ensure businesses have the expertise for specific projects.
Cost-effectiveness. IT staff augmentation enables organisations to optimise costs by flexibly scaling their workforce up or down based on project needs.
Faster onboarding. By having available talent when needed, companies can reduce the time to start and complete projects.
Depending on their specific needs, organisations can choose between contract-based or project-based staff augmentation or seek assistance with talent sourcing.
AvePoint Singapore partners with businesses to implement digital transformation strategies swiftly, providing best-in-class IT professionals and flexible talent solutions tailored to the organisation’s needs. With AvePoint, talents are sourced and thoroughly trained, building IT teams that drive success.
Mayella is a Content Marketing Specialist at AvePoint, focusing on digital transformation, AI confidence, and education technology. With a background in content production and communications for B2B and e-commerce, she excels at helping businesses transform their digital workspace into a dynamic and efficient environment.
