The shortage of skilled human resources has been a big problem for different industries, especially the software developer recruitment agencies and the companies. To bridge the tech talent shortage, many companies, as well as agencies, opt for the different ways of technical hiring, such as hiring dedicated developers through IT outstaffing from remote geographical locations.
Let’s expand upon the tech talent gap in the industry, what challenges the industry faces while hiring tech talent and what are the ways to fill the requirements of tech jobs and associated technical skills in the software industry across the globe.
Global Demand and Supply of Software Developers
According to the Evans Data Corporation Predictions, the total population of the software developers will be around 26.4 million by 2019. This report clearly indicates that APAC region and some countries in the Eastern Europe region will predominantly lead the global growth of producing the software developers.
The North American and the Western European countries, where the demand for software developers is huge generate negative growth in the supply of tech graduates.
The new research conducted by the Michael Page suggests that the profession of software developer tops in the demand list across 24 major countries across the globe. The software professionals are highly demanded in North America, West Europe and Australian regions where the best companies to work for – both local and multinational companies – are located.
About 50% increase in demand was noticed between 2003 and 2013, as per the Bureau of Labor Statistics figures. The predicted average growth in the software developer jobs is about 22% for the next decade in the USA. The Economic Modeling report predicts more than 3.5% annual growth in the demand for software developers between 2017 and 2025.
Moreover, the high demand for software professionals exists in the countries where the technical recruiter salary is also very high. So, the overall demand for software engineers will remain high for many years to come because new domains like artificial intelligence, machine learning, internet of things and other such technologies are just taking the stronger roots.
Challenges the Software Industry Faces
The software industry across the globe, especially in the developed countries is facing many big challenges related to the shortage of software developers in the local marketplace. A few very important challenges that the existing software industry faces include the following:
- The demand is very high and supply is very low so you struggle with hiring the right candidate matching your requirements
- The cost of hiring software developer is increasing consistently across the globe
- Technical talent war through highly lucrative offers keep rounding in the marketplace regularly
- The retaining the technical professionals has become so difficult
- Multicultural, multi-generation and multi-language workforce
- Increasing trend of professionals moving towards freelancing and remote working
- Complex tech pro-research due to fussy job descriptions
- Complex hiring process due to governmental and industry regulations
- Unavailability of right candidate with the right skills in the local market
- Demand for developers is also increasing in big developing countries where the tech talent was in abundance, like in India and China
- Security of the business critical information due to job switching of developers within the competitors
All these challenges put the executives and entrepreneurs in double stress on whether to hire technical talent from the local market or develop an offshore team of developers for their development projects.
Top 3 Remote Hiring Options
To meet the towering talent hiring challenges, many companies choose to adopt the alternative methods of hiring that offer more flexibility, cost efficiency and reliability. Among such hiring methods, the top 3 remote hiring models are described below.
Outsourcing
In this mode of hiring, the entire software development project or operations of an entire business process is handed over to the third party company, which manages the entire process independently.
Pros
- Fully managed
- No technical and management staff required
- Fast availability of resources
Cons
- Very costly hiring model
- Little control over development teams
- Business information security issues
- Reduced work quality
Outstaffing
In this model of hiring, the third party provides the technical resources with development infrastructure and administrative support. You hire dedicated developers powered by the third party guarantee of quality and timely delivery for your specific development project at a fixed cost.
Pros
- Offers competitive prices
- Allows greater control over the team
- Zero up-front cost for dev infrastructure
- Reliable and flexible to scale up or scale down
Cons
- Remote team management is comparatively difficult
- Communication and language related issues
- Geographical locations and time zone related issues
Freelancing
Freelancing is very popular for small projects and short-term tasks. In this case, a freelancer or a team of freelancers is hired for a particular task or project without any guarantee from the third party company.
Pros
- The cheapest form of remote hiring
- Availability of a huge pool of global talent
- No up-front cost for development infrastructure
Cons
- Very less control over the freelancer
- The freelancer can vanish at any time, so it is an unreliable model of hiring
- Language and cultural barriers
- Uncertainty about the quality of work
Software Developer Concentration Areas
The main concentration areas of software developers worldwide include China, India, Ukraine, Russia, Indonesia and a few African countries. Ukraine is one of the most popular countries for the remote hiring of software developers owing to its large technical talent pool and European work culture. Ukraine and other Eastern European countries also offer competitive prices and high quality of work.
Final Takeaway
- Demand for software developers is very high as compared to supply in major countries of Europe, North America and Australia
- Technical talent hiring industry is facing numerous challenges in hiring and retaining the talent
- Outsourcing, outstaffing and freelancing are the best way out for industries to overcome the challenges
- Ukraine, Russia and India are the best options for remote hiring for recruiting managers
