The world is now facing a rapid increase in unemployment rates. Companies are faced with an increasing shortage of locally-recruited staff. Tech-based companies are struggling to retain or employ developers and programmers to maintain their systems and platforms amidst the restrictions and risks in place.
Why Hire Outstaff Software Developers?
With health and security risks and restrictions put in place, companies are now pressured to find more cost-effective alternatives to their usual business model. For tech and tech-based companies, outstaffing has been a great alternative to the shortage of Software Engineers and Software Developers. Examples like looking for Android Developers that companies can employ despite the health and business risk.
Outstaffing and Outsourcing
Outsourcing is a profitable market and has increased in market size from 2000 – 2019. In 2019, this industry was estimated to be worth 92.5 billion USD. Outsourcing has expanded to cover various industries – like energy, healthcare, retail, telecom, and IT services. The leading reason for companies employing outsourcing and outstaffing services is cost-cutting. Outstaffing also enables businesses to focus and improve on core business processes and addresses capacity-limitation issues. Due to its size and reach, outstaffing may be an overwhelming challenge at first, especially when trying to figure out where to hire from.
Top Countries for Software Engineers
Before putting out a list of the best countries, we first need to understand that several factors go into categorizing any country as one of the “top countries for software engineers”. Feeding into this categorization are factors such as Cost of Living, Average Wages, IT and Innovation, and Quality of Life.
Cost of Living
The cost of living in a country indicates how much it costs to live in an area. The cost of living can be attributed to essential expenses such as apparel, food, education, housing, transportation, medical, recreation, and other goods and services. Depending on the country, a software developer or software engineer can have a high or low cost of living.
The cost of living can be an indicator of the quality of life and the average wage of a software developer and software engineer. Below are the overall top 10 countries and top 10 cities around the world with the highest Cost of Living Index as of Mid-Year 2020.
| Rank | Country | Rank | City | |
| 1 | Bermuda | 1 | Hamilton, Bermuda | |
| 2 | Switzerland | 2 | Zurich, Switzerland | |
| 3 | Norway | 3 | Lugano, Switzerland | |
| 4 | Iceland | 4 | Basel, Switzerland | |
| 5 | Japan | 5 | Geneva, Switzerland | |
| 6 | Denmark | 6 | Lausanne, Switzerland | |
| 7 | Luxembourg | 7 | Bern, Switzerland | |
| 8 | Bahamas | 8 | New York, NY, United States | |
| 9 | Israel | 9 | Stavanger, Norway | |
| 10 | Singapore | 10 | Trondheim, Norway |
IT and Innovation
Innovation is a good indicator of the quality of the IT market. This also helps indicate the capacity for prosperity and growth in a country. This is especially relevant when a country is facing a shortage of Software Developers. The innovation index indicates how much any country invests, concentrates, and can innovate.
Indicators for the Innovation Index (based on the Bloomberg Innovation Index) are a country’s capacity to invest in Research and Development, patent activity, and higher education. The overall productivity, density of tech companies, capacity to concentrate in research, and its added value in various industries also marks a country’s innovation.
Below are the top 10 countries in the 2020 Bloomberg Innovation Index.
- Germany
- South Korea
- Singapore
- Switzerland
- Sweden
- Israel
- Finland
- Denmark
- United States
- France
Aside from Innovation, we also consider the Digital Competitiveness of a country in the global market. The IMD World Competitiveness Center has published its 2020 IMD World Digital Competitiveness Ranking, that included an evaluation of 3 factors in a country:
- Knowledge – presence and capacity for technological learning
- Technology – current landscape for developing digital technologies
- Future Readiness – economic preparedness for digital transformation
The top 10 countries in the 2020 Digital Competitiveness:
- United States
- Singapore
- Denmark
- Sweden
- Hong Kong SAR
- Switzerland
- Netherlands
- South Korea
- Norway
- Finland
Average Wages
Taking the list of top 10 countries worldwide based on Digital Competitiveness, the average salary of a software engineer and software developers in these countries are:
| Country | Average Salary of Software Developer | Average Salary of Software Engineer |
| United States | $105,600 (USD)/yr | $108,600 (USD)/yr |
| Singapore | $99,500 (SGD)/yr ($73,350 (USD)/yr) | $102,300 (SGD)/yr ($75,400 (USD)/yr) |
| Denmark | 565,000 kr. (DKK)/yr ($89,800 (USD)/yr) | 581,000 kr. (DKK)/yr ($92,300 (USD)/yr) |
| Sweden | 572,300 kr (SEK)/yr ($65,300 (USD)/yr) | 588,400 kr (SEK)/yr ($67,100 (USD)/yr) |
| Hong Kong SAR | HK$649,200 (HKD)/yr ($83,800 (USD)/yr) | HK$667,500 (HKD)/yr ($86,100 (USD)/yr) |
| Switzerland | CHF 100,600 (CHF)/yr ($110,900 (USD)/yr) | CHF 103,500 (CHF)/yr ($114,100 (USD)/yr) |
| Netherlands | € 63,720 (EUR)/yr ($75,400 (USD)/yr) | € 65,515 (EUR)/yr ($75,400 (USD)/yr) |
| South Korea | ₩50,577,700 (KRW)/yr | ₩52,004,600 (KRW)/yr |
| Norway | kr 785,600 (NOK)/yr ($84,950 (USD)/yr) | kr 807,800 (NOK)/yr ($87,400 (USD)/yr) |
| Finland | 72,200 € (EUR)/yr ($85,400 (USD)/yr) | 74,300 € (EUR)/yr ($87,900 (USD)/yr) |
The United States tops the list of countries with the highest average salary for both Software Developer and Software Engineer. This is closely followed by Switzerland, Denmark, Finland, and Norway. These 5 countries, or at least some of its cities, ranked consistently high in terms of innovation, digital competitiveness, and cost of living. Not only are the economies of these countries enable these developers to earn this much, but these countries also have the capacity for a high quality of life, technological development, and innovation.
Demand for Software Engineers and Developers
There were an estimated 23 million software developers worldwide in 2018 and 23.9 million in 2019. This number is forecasted to grow up to around 29 million by 2024. As tech adoption and integration expands, the higher the demand for IT professionals – like software engineers and software developers – becomes and the lower the risk for a shortage of Software Developers.
The programming languages used to develop these technologies are also highly relevant to the demand for software engineers and software developers. As of early 2020, the most used programming languages by developers are Javascript, HTML/CSS, SQL, Python, and Java. Fullstack software developers that are capable of working with any and all phases of software development are highly in-demand. This is in no way discounting the fact that highly-skilled and specialized developers are equally in-demand.
Top Countries for Software Engineers and Developers
It can be said that the best countries have the capacity and economy to support the best developers and reduce the risk of a shortage of software developers. And all these advantages enable countries such as the United States, Switzerland, Norway, Denmark, and Finland to train and employ the best developers in the industry.
When considering outstaffing services, it is best to use these statistics and studies as a benchmark and starting point for your search for quality outstaffing service providers. Clearly, you would need to look towards countries with the capacity to support technological development and IT learning, but not necessarily the ones with the highest cost and quality of living. You also need to consider looking towards countries with more manageable average salaries for Software Developers and Software Engineers. This is essential since operational costs are the ones that will cost you the most when employing outstaffed Software Developers.