Outsourcing

The Crisis of the U.S. Software Developer Shortage

by
Ana Maleski
The Crisis of the U.S. Software Developer Shortage

With the rise of computers in the 1980s, computer science degrees jobs have been in demand – and still are in this technology-booming era. However, there are not many people who are graduating with computer science degrees to meet this demand in the U.S. and worldwide.

“The U.S. Bureau of Labor Statistics states that by 2020 there will be 1.4 million computer science-related jobs available to the public with only 400,000 computer science graduates to fill those roles.”

Software developers are in need to fill jobs in the IT industry and many potential candidates are becoming highly selective with potential companies. This is creating bidding wars between companies to hire in-demand software developers in the U.S. and worldwide.

Challenges Faced by Employers

With the shortage of software developers and engineers, IT companies are having a hard time finding dependable and reliable skilled talent. This talent pool is shrinking and is becoming self-evident companies are burdened by the ability to find qualified individuals.

In-demand software developers and engineers know their skills are valuable and are needed in the IT industry. While the talent pool is highly selective with whom to work with, companies are also highly selective to whom are hired. Software developers and engineers can lose a project on several categories during the hiring process, but there are five top categories companies will pass the project onto someone else.

Experience

Computers have been around since the 1980s and with the emergence of technology continuing into the 21st century, the demand for reliable and dependable software developers and engineers are critical. Due to the sudden rise in individuals with computer science degrees, many are recent graduates with minimal to no work-field experience. This is the number one factor many IT companies will not hire a potential candidate and pass the project onto to someone who have at least five years of experience.

Software developers and engineers can increase their likelihood to be hired by creating an outstanding portfolio that showcases their skills they have done during their studies or from an internship, despite the resume having a lack of work-field experience.

Technical Skills

In the IT industry, there are numerous skills that not every software developer or engineer will have knowledge of. Companies will need to find the candidate that possesses the skills to complete the project on time. At times, a potential hire may not possess all the skills a company is looking for but qualifies from the other categories.

Soft Skills

A potential candidate will need to have the following soft skills in any working environment:

• Teamwork

• Communicate effectively

• Problem solver

• Work ethic

• Interpersonal skills

• Flexibility

A company may find the right candidate for the project or company, but without the necessary soft skills to apply to any working environment, the opportunity will be passed onto to another potential candidate.

Formal Education

Majority of U.S. public schools do not teach or require a computer science course before graduation. About 35% of high schools offer it as a course, and 22 U.S. states does not contribute those courses to graduating credits like math or science. Only 14 U.S. states have adopted computer science standards despite 58% of all new STEM jobs are in computing. Computer science is the largest job field on Earth. The education system has not contributed the factor that computer sciences are an integral part of the academic learning system.

Many software developers are self-taught. While this can be a great contributing factor for working independently and being self-motivated, many companies see this attribute an accountability flaw with the potential candidate’s capabilities and skill sets cannot be verified. With formal education, the flawed attributes can be guaranteed by the institution verifying the potential candidate ability to possess the specific skills indicated.

Salary Demands

The IT talent shortage means less competition for potential software developers and engineers seeking contracts or fulltime work opportunities with a company. Moreover, this results in an increase of salary demand by the potential candidate for their specific skills. The risks a company invests in when hiring a candidate can be overwhelming as the company does not want to hire a developer or engineer who will deliver poor results at too high of a price.

Outsourcing Helps U.S. Companies Reach Innovation Goals

For the past ten years, software developers and engineers have been the largest and hardest jobs to fill in the U.S. These U.S.-based companies have opted for outsourcing IT projects offshore to fill the gaps in-demand and have launched offices in North Macedonia in major tech cities like Skopje. This area is also referred to as Eastern Europe’s Silicon Valley.

The U.S.-based talent shortage is the main reason why American companies outsource projects offshore. The second reason American companies outsource projects is the increase demand of high salaries with little work experience by local talent. According to Glassdoor, the average annual base salary of a software developer in the U.S. is $83,197. The U.S. Labor Department states it’s $100,080. In Silicon Valley, the same software developer can cost an average of $133,010.

By outsourcing talent, a company can hire a software developer with the same skills with an average of $67,200 (including all taxes and benefits).

Comparison of a software development team in San Francisco vs North Macedonia:
USA Vs North MAcedonia Salaries
‍Source: Glassdoor

Total salaries plus benefits of a 5 member team, for 3 years in San Francisco: $2,438,812
Total salaries plus benefits of a 5 member team, for 3 years with VUSE: $1,008,000

Reasons to Outsource to North Macedonia

For U.S. companies to outsource with offshore skilled talent in North Macedonia can increase the opportunity to deliver products on time and at a reasonable salary versus what a potential candidate may demand locally. In North Macedonia, a large skilled talent pool is waiting for opportunities to work on projects, filling in jobs the U.S. cannot fulfill alone.

VUSE serves as the bridge to help companies grow by matching open talent needs to high-skilled offshore software development teams through Innovation Centers of Excellence.

Contact VUSE today to help overcome the problems of hiring software developers.

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