The evolving workforce: key hiring and promotion trends in European technology 

In today's dynamic landscape, technology companies are navigating an environment marked by volatility and rapid change. As a result, there is an intensified focus on cost reduction and the optimisation of processes and labour. Essentially, a drive towards greater efficiency and the implementation of artificial intelligence (AI) and, through that, a stronger return on investment.

However, amidst these efforts to enhance operational effectiveness, the demand for specialised skills that propel the development agendas of tech companies remains strong. As we look ahead to 2026 the sector is poised for robust growth, with global IT spending projected to increase by over 9%. This growth is largely fuelled by significant investments in data centres, software development, AI and cybersecurity.

Compounding these challenges is the increasing scrutiny from policymakers across Europe regarding fair pay and transparency. To remain competitive and responsive to these evolving demands, organisations must prioritise the development of compensation packages that not only meet market standards and legislation but also align with their strategic objectives and the expectations of their workforce.

As the technology sector in Europe continues to evolve, understanding the trends in hiring, turnover and promotions is essential for both companies and professionals. The landscape is shaped by rapid advancements in technology, shifting workforce expectations and economic factors that influence talent management strategies. This article delves into the current hiring trends, turnover rates and promotion dynamics within the European technology industry, providing insights into the challenges and opportunities that lie ahead.

In the first quarter of 2025, the European technology sector saw the highest hiring of decision-makers and experts in the field of the internet of things (IoT). With a hiring rate of 45% in Europe, as indicated in Figure 1, they represent the fastest-growing group of engineering roles.

As the IoT continues to reshape industries across Europe, the role of IoT developers has become increasingly vital. These professionals are responsible for designing and developing IoT solutions that integrate hardware and software, enabling devices to collect, transmit and analyse data effectively.

The field of AI and machine learning stands out as one of the few professions that are highly represented globally, with a rising trend following the breakthrough developments in large language models in recent years. As companies fear being left behind, we see ongoing strong investment in this specific profession, with hiring rates exceeding 27% across Europe. Economic challenges and competition for innovation have further rapidly increased the importance of AI in recent months. Additionally, more AI-specific applications are being incorporated into other technological professions and jobs.

Scrum project management, with a hiring rate of 26% in the European region, reflects the need for professionals who support agile organisational forms. Agile teams, primarily based in software development, are increasingly recognised for their ability to facilitate collaboration and teamwork, driving projects with greater efficiency and adaptability. This trend is also evident in the US and Asia, where scrum project management plays a significant role, with hiring rates of 27% and 25%, respectively.

Beyond research and development (R&D), there is a clear emphasis on employee experience roles, with a hiring rate up 54% across Europe according to Mercer | Comptryx, highlighting companies' commitment to understanding employee needs and preferences. This focus enables organisations to design compensation mechanisms that align with the expectations of their workforce. Additionally, there is a marked increase in hiring within IT, cybersecurity and cloud engineering roles as companies invest in building out their physical infrastructure, including processing centres and the need to build safe technical environments.

The landscape of hiring trends is marked by significant regional disparities as data from Figure 1 outlines in the chart to the right. In China and Germany, hiring rates are notably subdued, reflecting a cautious approach from Western companies as they navigate ongoing economic uncertainties in China and await economic stimulus from the German government. Conversely, Ireland and the UK emerge as beacons of opportunity, showing the highest hiring rates in Western European economies, particularly for roles in artificial intelligence. This surge is primarily driven by substantial investments from American firms that established their European headquarters in either of these markets, supported by favourable tax conditions for R&D activity in this space and public investment.

Meanwhile, Eastern European markets continue to exhibit robust hiring activity, underscoring a strong demand for talent in the region.

In contrast to the focused hiring for specific engineering and other pivotal talent in recent years, both voluntary turnover rates and promotion rates have experienced a notable decline across Europe, particularly since 2023, when large-scale layoffs at major technology companies sent ripples through the market. Key markets such as the UK, the Netherlands and Poland were particularly affected (downward trends shown in Figure 2), indicating a shift towards a less favourable environment for employees, characterised by fewer job opportunities. This decline in turnover suggests that companies are adopting a more cautious approach to talent investments, resulting in a more stable, albeit less dynamic, workforce.

Simultaneously, promotion rates indicated in Figure 3 are also on the decline as organisations tighten their budgets and reassess their talent management strategies. While promotions remain most prevalent in R&D and operations, the overall numbers are significantly lower than during the pandemic. This reduction raises several important considerations:

As companies navigate this complex landscape, it is crucial for them to address these challenges proactively, ensuring that they not only retain talent but also foster an environment where employees feel valued and have clear pathways for advancement. 

In addition, organisations that take a more strategic approach to pay transparency have a powerful tool for attracting and retaining top talent. When jobs, career paths and compensation structures are clearly defined, transparency helps employees see their future within the organisation. It reinforces fairness, strengthens employer branding and improves workforce engagement, and as a result, productivity. 

In summary, the current hiring, turnover and promotion trends in the European technology industry reflect a landscape of both opportunity and challenge. 

While there is significant growth in specific areas of R&D such as artificial intelligence, cybersecurity or cloud infrastructure, the decline in turnover and promotion rates indicates a more cautious approach from companies in managing their talent.

HR leaders play a crucial role in navigating these challenges. They must act as strategic partners to ensure that organisations not only adapt to the evolving landscape but also thrive by fostering a resilient and engaged workforce. 

By taking these actions, HR leaders can effectively address the challenges posed by the current landscape in the technology sector, ensuring that their organisations remain competitive and capable of attracting and retaining top talent.