Remote software developer salary: what’s the benchmark?
Government reports in the US state that there are up to 1 million IT jobs are left unfilled each year. The unemployment rate in the US tech industry is also lower than any other industry — at just 2%.
The demand for tech professionals across the country is consistently very high, which is partly due to the fact that the number of professionals is not growing fast enough to match demand.
Another contributing factor is that there is a constant and rapid shift towards using new technologies and simply not enough time for IT professionals to keep up with the pace of change.
The Pacific region is the biggest tech hub in the US and faces the greatest skill shortage. The most severe skill shortages are in emerging areas relating to:
- Data analysis
As well as more traditional tech roles like:
- Software engineering;
- Web developers
Knowledge of Salesforce is amongst the most demanded complementary skill.
As the roles in demand are becoming increasingly technical, it is challenging for HR managers (and recruiters) to identify really talented developers in accordance with job descriptions.
As these skill shortages and HR challenges become more pronounced, product and technology companies are needing to look offshore and at alternative hiring options. At least in the interim, while they wait for the ideal IT professional to appear on the domestic market.
An interesting trend to take note of — in the USA, 57% of the companies in IT sector practice some form of remote work. Presumably, this is a way for companies to provide talented software developers even better conditions, very high salaries and amazing office environments are no longer enough to attract the best on the domestic market.
Aside from allowing your American developers to work from Alaska or Turkmenistan, here are some other remote software development models and means of sourcing remote talent:
Option 1. Traditional outsourcing
One of the most obvious options that comes to mind for most hiring managers is the traditional outsourcing model.
In fact, many software outsourcing companies have partners and sales offices onshore in the US. They can meet with clients in person before services are outsourced or in the case that projects run into issues. This is the case for a number of Ukrainian software development companies like TechMagic, Rademade, DevCom etc.
Option 2. Sourcing high-quality freelancers
However, those who have experience with hiring freelancers will be aware that there are a range of risks and disadvantages relating to:
- The likelihood that freelancers will be working on multiple projects at once
- The difficulty of managing them, particularly when you are trying to get multiple to work together
- Communicating with them
- Delivering on time
If we add all of these risks together we end up with elevated and sometimes unacceptable levels of risk.
Option 3. Remote contracting sites
Over the last few years, the number of sites where developers can apply for remote work has increased quite dramatically.
These sites often provide:
- Access to developers’ CV who wish to operate remotely
- Clients the ability to post jobs that can be done remotely
Here are some of the main sites and their respective offers:
- Cybercoders listed 41 remote software developers roles just this week,
- Remote and OK offer contract job opportunities to those who want to work remotely.
- Indeed allows you to change geography and tape straight into local markets in offshore locations
Option 3 is typically an improved version of Option 2 because contractors will limit the number of clients they service to 1 or 2 during the contract period. Meaning that they can provide a degree of focus that freelancers often cannot.
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Reflecting on the above 3 options
However, all of the above three options can be a bit hit and miss, in terms of:
- The time it takes to recruit talent through these channels;
- The quality of the talent;
- The service level these individuals can provide remotely.
Important to mention:
Options 2 & 3 don’t allow you to scale the team because you are essentially engaging with developers individually.
Option 4: Platforms for hiring individuals and teams of developers
Hiring platforms like YouTeam, VenturePact and ModernWeb offer thoroughly vetted teams of developers. This can be a great way to find a remote work software developer or even a team of software developers.
Companies and developers are subject to a comprehensive vetting process, which ensures that only top performers are on the list. Hence the quality risks are reduced substantially.
Developers’ soft skills are also reviewed during the vetted process applied by YouTeam. Which allows clients the ability to search for developers on the basis of certain soft skills in addition to their technical knowledge and experience.
Price comparison between platforms for hiring and remote software developers in the US
In terms of salary, remote work software engineers in the US receive the same salaries as on-site developers. However, in real terms, there will be a reduction in the company’s expenses relating to not needing to provide office space and other onsite perks.
The average annual salary of the software engineer in the US is $90,000-$100,000.