Supply vs. Demand: The Economics of the Tech Talent Shortage
The scarcity of software developers has made finding engineering talent more challenging than ever. We look at the facts and causes of IT talent shortages in the United States, as well as how overseas hiring might help companies compete in a domestic market.
The Demand for Software Developers in the U.S.? According to the U.S. Bureau of Labor Statistics, the demand for software developers, including software engineers, will increase to 22% between 2022 and 2030. This percentage is almost 4% more than the growth of average careers. If the country’s software developer shortfall continues to expand at its current rate, the government will face an unrealized output. Without new talent, business development and digital transformation are difficult, widening the gap between supply and demand for tech skills.
An increase in the demand for innovative software:
Websites and applications are now required by even small firms to facilitate operations and customer engagement. Even health insurance companies rely on software to manage enrollments and keep track of all customer plans.
Furthermore, many goods on the market require the usage of specific software to function. Software engineers are in great demand as the need for mobile-friendly apps and websites grows.
Software code has a finite lifespan:
Due to the constant change in code, businesses are needed to update their software on a regular basis. A code's lifespan is normally only a few years, and businesses require the assistance of software engineers to obtain a new one in time for a critical technological shift.
Advancements in Technology:
While the outbreak may have caused businesses to postpone investment plans for a time, companies are now gradually reallocating their technology spending, resulting in an increase in demand for software developers in the US and around the world.
Furthermore, many venture capitalists are willing to invest in businesses that have been affected by supply chain disruptions. As a result of this move, various companies have been persuaded to hire an increasing number of software engineers.
Underdeveloped Tech Internships:
Unfortunately, the educational system discourages internships in the technology business. The absence of training discourages people who want to work in software engineering but are concerned about not gaining enough expertise before landing a position.
Some companies provide internship opportunities. They are, however, nearly usually unpaid. Given the technical nature of software engineering, a respectable starting wage is a major attraction. Because internships and low-tech experience do not exist, many people may struggle to perform well in a sector of their jobs if they do not have it. As a result, paid internships are vital for learning the necessary skills and expertise in software engineering before landing a dream job.
Skills mismatch between academia and industry:
Unfortunately, many university computer science programmes do not adjust their curricula to meet the needs of industry. They fail to prepare students for the real world by failing to aid them in comprehending software engineering's actual application. Instead, most computer science departments focus on the theoretical aspects of their fields while neglecting to teach students the necessary skills.
Many departments also prefer to teach Scheme rather than other industry-standard programming languages. Furthermore, students are rarely taught in a hands-on manner with exercises and examples that will prepare them for post-graduation work in the software industry.
Strict Hiring Competition:
The hiring is so difficult that retention has become tough: Companies hire from their competitors and vice versa, so they have to keep replacing people who leave. Census and Bureau of Labor Statistics data show that 95% of hiring is done to fill existing positions. Most of those vacancies are caused by voluntary turnover.
Shifting Hiring Trends:
Because there is a scarcity of professionally trained graduates, businesses are beginning to welcome individuals who have taken more unconventional paths. After all, why should their academic credentials matter if they can demonstrate that they are more than capable of handling the job?
As a result, persons who re-skilled while working in other fields or went to a programming boot camp are now being considered for software engineering positions.