Bob Dylan poignantly wrote, “Times, they are-a-changin’.” In a world upended by a global pandemic and the business, supply chain and consumer behaviors that followed, this statement seems to ring truer than ever. An evergreen anthem to the varying societal and economic turbulence we face has proven this song’s impact through varying obstacles. We’re becoming more familiar with cryptocurrency and staying in awe of the self-driving cars we’ve been anticipating for years, all while hosting virtual meetings wearing AI headsets and, perhaps, pajama pants. Yet, business owners and consumers alike wonder how the world can adjust to this sudden shift to a “new normal” and how we can continue to gain momentum when much of what we knew has slowed to a halt. Even though the Jetsons made it seem like we’d be flying our automobiles by now, the point is that technology has continued to be the critical component in allowing us to meet the new challenges we face head-on with speed and agility.
Accepting the Demand for Software Developers in a Remote Workforce
While the global pandemic has changed so much of what we can safely do and how we implement it, the need for technology services and filling new roles proves to be an exception. Shelter-in-place and flattening curves aside, the demand for software development has risen to an all-time high. An employment estimate calculated by the Bureau of Labor Statistics predicts that there will be more than a 22% increase in the number of software developers in the US by 2030, compared to the overall employment rise of 7.7% across all job sectors.
During the worldwide shift and surge in technology needs, development teams had to adapt to remote workforces for the foreseeable future, which proved longer-lasting than anticipated. Many companies have gone back to an in-office or hybrid work option, but the software engineering community started pushing back – with good reason. As cloud-first infrastructure trends upward in popularity, the remote workforce sees the advantage of taking things virtually. Why require five-day in-office work weeks for jobs that have proven to be successful remotely, when the competition for key talent continues to climb? Software engineering professionals have a wide variety of opportunities in this climate, which means remote is not just an option anymore – it has become a requirement to acquire and retain key talent.
Managing Rising Salaries and Increased Employee Demands
According to the Bureau of Labor Statistics report, 2021 saw a turnover rate for software developers at 57.3%, as well as increased confidence in the job market across most industries. Web developers saw the most significant pay increase, shooting up 21.3%, more than a fifth of their previous salaries. A Senior Director at LinkedIn was quoted via InfoWorld saying technology roles have proven to remain pandemic-proof. She noted that roles like backend developers and software engineering roles, in particular, have significantly increased in demand. The 2022 Tech Salary Report by jobs marketplace Dice found that the average salary for technologists rose by nearly 7% between 2020 and 2021, reaching $104,566. Dice reported that this marked the highest salary recorded in the 17 years it conducted the survey. Now seven plus percent seems reasonable considering inflation and the pandemic-related forces, but this is an industry average and pales in comparison to the 21.3% increase in pay for web developers mentioned previously. In a similar report by Dice, salary increases were well above averages for security and cloud developers: 16.6% for cybersecurity and 12.2% for DevOps roles. And if that wasn’t bad enough for budgets and turnover rates, 47.8% of tech workers surveyed still feel underpaid.
One software development job market study found close to half a million software industry jobs on the market in 2019, with a similar amount of people leaving the field for retirement in the next several years. Another report estimated that the US could be at risk of losing billions of dollars and eventually having a shortage of over 80 million software developers by 2030. The increase in talent demand paired with a significant shortage could mean – you guessed it – even higher salaries for software developers persisting for years to come.
The need for software engineering professionals exists and continues to grow while the world adjusts and prepares for a post-pandemic economic climate. While this predicament feels sudden, the data shows that this is not going away anytime soon. What does that mean for software development agencies or companies hoping to fill new technology roles? In order to retain talent, businesses must adjust to the new needs of engineering professionals and continue to scale teams using team extension solutions like nearshore software providers. A survey by Statista showed that 64% of technology outsourcing was dedicated to software application development, allowing teams the opportunity to scale faster and provide cost savings for the rising US-based engineering salaries.
Even with the state-of-the-art office your company may be providing, the fact remains; other companies will continue to provide fully remote positions that will be filled by developers not wanting to return to in-person workspaces. The companies staying ahead of, and potentially offering more than, industry standards for salaries will also attract and retain that talent. As the times are changing, so is the software development industry. Whether you choose a staff augmentation partner or plan to navigate this on your own, be sure to stay ahead of the hiring trends, build a solid foundation and keep focused on the technologies your business needs right now. Make sure to remain on the course of your technology roadmap as well. While this may seem like uncharted territory, it doesn’t have to be.