Where have all the developers gone ?
Developer shortages to continue in 2022
If you’ve had trouble trying to find developers to write your app - any app - then, sadly, you’re not alone. Not that it’s much of a comfort to know, of course.
2021 has been the year of the Great Developer Drought. All over the world, supply has outpaced demand for software engineers. To be honest, this has always been the case, but, with the 2020 pandemic leaving companies no option but to put Digital Transformation projects on hold, this year has seen a sudden increase in demand for skilled developers who, simply put, aren’t there.
Profit margins in software development can be quite slim, as there’s always a risk of running into issues which take up more time, and hence money, to resolve. Development companies can now pick and choose which projects they work on, with an estimated 30% of work being rejected, even pre-pandemic.
Development companies will therefore naturally pick and choose larger, corporate funded apps: smaller, more risky apps commissioned by startups will tend to be sidelined in-preference to safer, larger projects.
THE EFFECT ON THE US AND UK
The US Bureau of Labor Statistics recently advised that American companies would face a 1.2 million shortfall in developers by 2026. A 2021 McKinsey survey found that 87% of US companies were seeing a developer shortage, or expected one in the next few years.
US Immigration policies formulated during the Trump presidency also added to the issue. With it becoming increasingly difficult for overseas students to enter and work in the US, American universities are producing less software engineering graduates. Most US companies look for formal qualifications when hiring candidates: with the lack of suitably formally qualified developers, talk is now turning towards accepting self taught developers who can pass simple tests instead.
The UK has been particularly badly bitten as well. Already slipping behind on digital transformation, the UK relied on a very limited number of home brewed developers and was reliant on foreign nationals from the EU to fill developer positions. As a result of Brexit, large numbers of developers have simply gone home, and EU companies are less willing to work with the UK post Brexit.
Huge momentum had started in the UK to become “more digital”, with Government sponsored innovation schemes and the development of tech hubs, so whilst the will and incentive was there to move towards digital transformation, the specialised manpower required to do it is lacking.
And of course, all of this is happening in the context of the Great Reshuffle, where large numbers of workers are reconsidering their lives and career options as both a result of the pandemic and increasing workload.
The shortage has caused extra work to be piled on existing developers who are, frankly, voting with their feet. IT staff are particularly affected with only an estimated 30% planning to stay with their current employer over the next 12 months.
NEARSHORING AS A SOLUTION
Given the lack of available local developers, one option is to look at nearshoring, an epithet for “offshore development”.
Offshore development has had a very varied press over the last few decades, with some notable (and highly public) failures.
Failed nearshoring / outsourcing projects have usually had lack of communication and poor project management as their root causes, the process can work extremely well if properly managed.
Over the last few years, the infrastructure in some countries has been changing to meet the development needs of Western companies. As an example, one city in Ukraine boasts 14 universities producing large numbers of software engineering graduates.
These graduates are snaffled-up by local development companies who invest in further training and free business English lessons. Simply put, Eastern Europe is reacting more quickly and more creatively than Western Europe, as living standards and expectations in Former Soviet Union countries continue to rise.
SUPPLY AND NEARSHORING
The supply of local developers has also lead to the knock on effect of Eastern European developers becoming more in demand, with a corresponding rise in prices. In Eastern Europe, arguably the destination of choice for those wanting to outsource or offshore app development, prices have risen by 10-15%, and show no signs of levelling off.
It’s difficult to find nearshoring companies who can directly offer skilled and experienced developers at reasonable rates. Even though more developers are available in Eastern Europe, as an example, there are still not enough to meet demand and therefore prices remain high.
Also, to compound the issue, the market is awash with companies offering contractors who don’t directly work for them or recruiters who essentially find independent candidates and then charge unrealistic rates of commission for them with a “get rich quick” approach. Coupling high developer salary expectations with unrealistic commission rates can rise prices to near equivalent levels for Western developers.
It can take a long time for a Western company to find reliable, cheap and capable nearsourcing partners - as an example, we invested six months into developing relationships with our suppliers in Ukraine. The results can be excellent, but there’s an overhead in finding and managing external contract developers.
OUR NEARSOURCED DEVELOPMENT SERVICES
Foresight Mobile have extensive expertise of working with reliable, professional and inexpensive nearshore development partners. Our UK based project management skills, combined with our nearsourced partners’ technical expertise, ensure the delivery of an effective, attractive and inexpensive mobile app project.
Contact us here to take the difficulty and uncertainty out of finding and working with overseas resources. We’ll be happy to reply with a competitive quote and examples of successful projects delivered in conjunction with our partners.
NEW TRENDS IN HIRING
With high quality, local developers becoming rarer and rarer, companies are beginning to look at new approaches to hiring. Traditionally, employers would interview University graduates (invariably male) in a convoluted and technical process: much was made of official degrees and the minutae of subject knowledge.
A limited supply of formally trained graduates means that employers are now beginning to consider candidates from non traditional routes. After all, if they can demonstrably do the job, why worry about the paper qualifications?
As a result, candidates who have attended programming bootcamps or who have re-skilled whilst working in other careers are now being considered for software engineering vacancies.
Will this solve the developer gap? No. Well. Not immediately. There will always be more work available than developers, and it takes time for developers to learn their subject and how to “do the job” in the real world. What will probably happen is that the industry will benefit from an influx of junior level developers who will then naturally mature over the course of the next few years. Whilst it’s a welcome temporary relief, the future of development probably rests in nearshoring, with an inevitable rise in development costs for the foreseeable future.
WILL THINGS IMPROVE IN 2022?
With nearshoring and a willingness to consider non-University graduates, there will be some easing of the problem in 2022…. but at the same time, demand for developers is increasing faster than the market can supply them.
Factor in a volatile employment market and the answer has to be that developers are going to be a rarity for the foreseeable future. Employers are going to have to strike a difficult balance between the availability of developers and the profitability of projects they work on - prices are inevitably going to increase across the board. At the moment, the conditions are there for a perfect storm.
It’s never going to be easy to find quality developers at cheap prices, but 2022 has all the hallmarks of a challenging year ahead. Good luck out there.