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Despite their best efforts, financial institutions have not been able to gain widespread appeal among tech talent and have had to resort to more significant incentives to draw in workers from this sought-after pool.

Salem Five earlier this month hired Raj Velmurugan, the former chief IT architect at Bose, as its new chief information officer to lead digital efforts as the bank continues to enhance and build out its digital offerings.

The hire is an accomplishment for a community bank outside of Boston but is less common in an industry still struggling to lure high-level tech talent.

“Reliance on technology increases each year for all industries, so competition for tech talent is substantial, and will remain so,” said Charles Begley, executive vice president of shared services at Salem Five. “It’s competitive across the board.”

Financial institutions in Massachusetts have access to a strong talent pool generated by the dynamic Boston-area economy, but are also disadvantaged by a historically low unemployment rate.

The state’s total unemployment rate fell to below 3 percent in April for the first time since 2000, according to the state’s Executive Office of Labor and Workforce Development.

Tech talent specifically is at even more of a premium. The tech industry’s national unemployment rate hit 1.9 percent in 2018, the most recent year that the U.S. Bureau of Labor Statistics has data for. Additionally, BLS reports computer and information technology occupations are projected to grow 13 percent from 2016 to 2026, faster than the average for all occupations.

Benefits Offer Way to Compete

To compete with the rest of the startups, tech, bio and pharmaceutical companies looking for talent, the banking industry has had to be more flexible, said Jane Fontaine, senior vice president of human resources and training at Marlborough-based Digital Federal Credit Union.

DCU’s IT department is staffed by almost 100 people, from information security personnel to a server team and developers. The company has approved even more new positions for hire – but filling posts is a constant challenge.

“Credit unions are not as sexy of an appeal for tech talent,” Fontaine said. “We’ve had to reevaluate salaries and, in some cases, hire above market.”

Compensation research shows DCU offered very competitive starting salaries, Fontaine said. But often it takes more money to get a potential candidate to pick the credit union over, a startup or well-established tech company in the heart of Boston.

The company has also done its best to add more perks to its benefit package that go above and beyond other firms, such as its student loan payback program, and allowing more flexibility for people to work remotely.

“We don’t like doing it, but that’s just the way it is these days,” she said of working from home. “As a credit union, we have to do a little more thinking and be a little creative [to attract talent].”

DCU has worked with local colleges and at times chosen to hire a more junior person for a role if they think that person has the potential to grow with the company.

But sometimes the usual sources of hiring have not been able to meet demand.

Fontaine said the company has tapped some sources it has never tried before, including the H1B visa market, an employment-based, non-immigrant visa for temporary workers who are well-educated. The company has also outsourced some of its IT work to Costa Rica, which Fontaine said has worked out well thus far.

Bram Berkowitz

What Gets Recruits Excited?

DCU lost its chief technology and innovation officer, David Araujo, when he was hired to be the CEO of Portsmouth, New Hampshire-based Service Credit Union last December.

Fontaine said the hiring process for his replacement, which is nearing completion, has provided some good insight into what gets tech candidates excited about a potential employer.

Most of people interviewed for the position have shown real excitement about the work they would be able to do with DCU’s FinTech Innovation Center, she said. The center is a nonprofit division of the company that essentially serves as an accelerator for promising seed-stage fintech startups.

Located near Boston’s South Station, it not only shows potential employees DCU is dedicated to innovation, but also offers the startup and entrepreneurial appeal candidates may be looking for in their next job.

Ultimately, while finding tech talent can be a challenging proposition for a smaller financial institution, Fontaine said the goal is to show potential tech hires that they may have had preconceived notions about the banking industry.

“We are trying to do cutting edge things and show people that expect banks to be stuffy that it’s not like that here,” she said. “You have to be flexible and think outside the box and sell yourself better.”