Technology is one of the industries most affected by outsourcing. In the mature technology markets like the US, Canada or Western Europe, battle for talent is among major trends. As the software development skills shortage intensifies, many tech companies look overseas – not only for lower costs, higher quality, greater flexibility, and better time to market, but also for valid experience and rare and niche skills.
Battle for Software Development Talent
IT and software skills shortage is one of the fundamental issues facing the developed world. In the United States, for example, the number of new IT jobs added in 2015 was estimated as ranging from 125,000 to about 180,000, similar to the 2014 trend in 2014. In 2016, almost 80% of tech companies reported talent shortages. Digital transformation, the rapid spread of connected devices, mobile technologies, business intelligence, robotics and social media continue to drive demand and keep it on high pace.
While the whole economy is becoming more and more digital, many organizations are struggling to fill positions for software developers. The UK needs over 745,000 additional professionals with digital skills to cope with the increasing demand between 2013 and 2017. Canada needs 182,000 people to fill positions for software engineers, computer programmers and interactive media developers, information systems analysts and consultants, computer and network operators, web technicians, and others by 2019.
Germany has more than 43,000 vacancies for IT specialists. A survey by Bitkom shows that more than a half of the German companies are short of IT specialists, and demand is greatest for software developers. Over 60% of the IT companies surveyed have vacancies for software developers. Firms are particularly in need of expertise in cloud computing (48%), big data (45%) and app programming (33%). Software languages in demand include .NET, Java and PHP.
The Hottest Skills in Demand
In recent years, the outsourcing paradigm has shifted from simple cost saving to experience- and skill-based outsourcing. To supplement local skills and knowledge, a significant number of businesses are looking for IT and software development talent overseas. The most demanded skills in today’s software outsourcing market include so called 3rd Platform skills, such as cloud computing, mobile development, and big data/analytics, as well as development for IoT and test automation.
Cloud Computing
Lack of resources and expertise is considered the #1 cloud challenge. Therefore, cloud computing is one of the major trends in the outsourcing market, very popular in the US and Northern and Western Europe. In 2016, for instance, 90% of British businesses were running at least one app in the cloud. Industry experts estimate that up to 80% of companies will have the majority of their operations in the cloud within three years.
Mobile Application Development
Many Western businesses outsource mobile application development to lower costs and stay focused on their core competences. The need is still great for Android and iOS developers. Hot skills in mobile also include Bring Your Own Device (BYOD) support and mobile security. This year, however, the trend has shifted from consumer apps to tailor-made enterprise mobile applications that allow companies to simplify work processes and improve efficiency.
Big Data and Analytics
What used to be hype has become the norm – demand for big data services and tools is rapidly growing, especially among large organizations that have loads of data. For many companies in different industries, including banking, manufacturing, and healthcare, big data analytics has become a business-critical function. By 2020, IDC forecasts that the US market for big data and business analytics solutions will exceed $95 bln., and the second largest region will be Western Europe.
Development for IoT
The Internet of Things (IoT) is clearly on the rise. Gartner forecasts that 8.4 bln connected things will be in use worldwide in 2017, up 31% from 2016, and will reach 20.4 bln by 2020. Businesses are predicted to invest more and more in IoT, which means that over the next 3-4 years the volume of outsourcing in this field will significantly increase. The US, Germany, the Netherlands, Sweden and the United Kingdom are among the most promising markets.
Test Automation
Software test automation is another rapidly growing area of IT outsourcing. One of the biggest challenges facing automated testing in the future is a lack of skilled and experienced resources. Outsourcing test automation is a smart way to reduce routine manual testing, eliminate the human factor, and speed up the process of testing web, mobile, and desktop solutions of any scale.
Auriga’s Insight
Auriga has 25+ years of experience in outsourcing software development and works with Northern American and Western European customers. Auriga’s client list combines industry majors, leaders in their segments, and innovative start-ups, including Chrysler, Lynx Software (ex. LynuxWorks), nVent (ex. Pigeon Point Systems), Draeger Medical, BroadVision, Dialogic, Barclays, Mindray and others. We always keep our finger on the pulse of the latest trends in the market to meet our customers’ specific demands.
Alena Berezina, Auriga’s HR Director, comments on the hottest software skills of today,
Outsourcing is a dynamic process, projects and customers change frequently. That’s why we value multi-field specialists, eager to learn new things, flexible, and ready to business travelling.
Besides cloud computing, big data, mobile, and the IoT that obviously shapeshifted the job market, remarkable outsourcing opportunities lie in Industry 4.0, virtual and augmented reality, robotics and AI.
As the focus is shifting from manual to automated testing, there is a huge demand for qualified professionals in this field. On the other hand, manual testing experience is still a plus.
Another promising trend is low-level development. Recently, we have hired a number of juniors and even interns in one of our low-level development projects.
