Recent global events have thrust the importance of digital technology into the spotlight. We have seen how digital comms platforms have become the new norm for working, and we explored how technology has been embraced by the NHS to support patience during unprecedented demand.
In our webinar, “The Future of Software Development“, we looked at how the global crisis and fall-out from it is impacting the software development industry in the UK and what this means for developers and employers.
Software development – a UK success story
The UK has a rich history of innovation and technical prowess, and that can be seen in the huge growth in Software engineering. It is estimated that the UK software market had total revenues of $23.7bn in 2019, representing a compound annual growth rate (CAGR) of 12.7% between 2015 and 2019.
The industry has made billion-dollar gains globally over the past ten years, as businesses and individuals have become reliant on electronic devices in many aspects of everyday lives pre and during Covid. Research firm Dscout has calculated the heaviest 10 per cent of users click, tap, or swipe their mobile device 5,427 times a day, and the average person is still on their phone 2,617 times a day. When we consider the amount of software used on each mobile device, then we begin to understand how key developers to our smart device world.
To get a sense of the size, according to Statista, In 2019, there were 386,900 programmers and software development professionals in employment in the United Kingdom. That does not include the almost 198,000 support roles in the software and services sector (data at 21 Apr 2020).
So, the demand for software developers is big, and it pays well – really well!
Recently, ITjobswatch, estimates that software engineering accounted for over 10% of all jobs advertised in the UK. It is also highlighting the rising average salary year on year.
More digital change on the horizon
So what’s that mean for companies and individuals?Well, in terms of the world, the demand for people with high-level digital skills is greater than the supply of suitably qualified employees, and the gap is growing. The World Economic Forum, in their Future of Jobs report, estimates that by 2022 emerging technologies will generate 133 million new jobs in place of the 75 million that will be displaced.
That’s a net gain of 58 million more jobs driven by – according to the WEF report – mobile internet, artificial intelligence, big data analytics and cloud technology. All areas that require digital skills, with developers heavily ensconced. These predictions mean the demand for software skills and knowledge will continue to grow. Countries and companies have challenges around finding and developing the skills to meet the demand for technology-driven economic activity.
The UK is the fifth most digitally advanced nation in Europe (Finland comes top) according to data from the European Union. It is already home to a large number of big tech businesses, and the UK has more tech “unicorns” (start-up businesses valued at $1 billion or more) than any other European country and estimates are that it hires approx. 5% of the total workforce, globally.
What this means is that there is fierce competition for talent, and this is only going to get bigger. All areas of the pipeline are reacting to this shortage, and in a recent Glassdoor poll, we can see the reaction for entry-level talent. I repeat. ENTRY LEVEL. Its top 6 roles and average salaries were:
1. Investment Banking Analyst : Median Annual Base Salary: £50,752
2. Software Engineer: Median Annual Base Salary: £34,106
3. Business Analyst: Median Annual Base Salary: £32,142
4. Data Scientist: Median Annual Base Salary: £30,791
5. Financial Analyst: Median Annual Base Salary: £28,717
6. Software Developer: Median Annual Base Salary: £28,609
The Covid effect
As one of the worst affected countries, Covid-19 has inevitably caused a downturn in large parts of the UK economy. Research from Sonatype suggests COVID-19 has caused a 28 percent drop in UK software development. This drop-off is more severe than in other countries. The analysis focused on seven key regions; the UK, US, China, Germany, Spain, Italy, and India. The UK stood out for a decline in software development activity while other nations continued to increase. The most significant increase was noted in Germany (12%) while the US (6%) also grew substantially.
So, what needs to be considered now and the future? PANIC!! No, I’m kidding, there are reasons to be positive about the UK software developer market.
Software development activity in the UK had increased by 78% from January 2019 – February 2020. This is further indication that UK firms are embracing digital change and fueling demand for developers.
What next for developers?
For individuals, across Europe, there has been a massive uptake in coding schools or bootcamps with people either updating skills or developing new skills to progress beyond their current career path – the UK is no exception. With a staggering choice of languages to learn, what do you need to think about if you are going to transition or develop your Software career? This is a hugely dynamic marketplace, rich in people diversity and forget about the stereotypes (except it does have a suspiciously high percentage of beards in its male population). You will have opportunities in amazing companies, projects and flexibility in your work/life balance.
So here are some key things to consider:
- You are a problem solver. Think problem-solving first, coding second. Projects can be very complex, so practice.
- What language suits you. They are not all the same, and you can choose popular (Python, C#, Java, Go, SQL, Powershell) or become far more specialist, Malbolge or Brainf@@k, for example.
- Communication skills – stop watching movie depictions of geeks/hackers with a fag and a dark room. Developers are working on projects and have multiple stakeholders so virtual and face to face skills are essential to successful conclusions on projects.
- Always be learning. This world evolves and adapts at a frightening pace and companies all use languages in different ways so be always prepared to grow your skills. Use skills camps, apprenticeships, or companies that have inhouse coding training.
- Be organised – deadlines are a critical part of your role and missing them can have a devastating effect (think NHS products in Covid) or commercial disaster.
What next for employers looking to hire developers?
For companies, there will always be a need to go to the market to get the very best experienced talent either permanently or the vast army of specialist contractors that the UK market has. You need to ensure you know exactly what you are doing and how you will engage. Are you stuck in your usual approach – then you will find that it won’t work going forward.
Here are some things to consider:
- Hire slowly – but make it memorable. Sounds simple but get the right people. Good people want to work with other good people so that quality hires will recommend other A-level developers to you. If you hire poor quality programmers, they will likely recommend people worse than them. Have you got a plan on how you engage, interest, and make your company appealing and who is part of the hiring process?
- Stay away from “rockstars”, “warlords” or any other stupid monicker. One person does not typically build the best software; teams build it. These teams communicate, engage, and don’t let egos rule their approach to a project. So, think long and hard before blowing all your money on one person – will it give you the solution you need or just a headache that you don’t want.
- Go for talent, not a job for life. If you are doing your job correctly and hiring the right people, you are unlikely to hang on to them for an overly long period. Top talent will almost always move on so you need to get as much out them as you can in the time you have while continuing to bring in fresh blood. Have you got that in your plan? Don’t feel bad, it’s not you – it’s them. Top developers are always looking to learn, and sometimes they just outgrow you.
- Cultural fit trumps coding finesse – developing your non-tech staff. There’s another reason you don’t want to hire “rockstars” as part of your team. They can be total…well I will let you insert the word. For most organisations, cultural fit is often as important as coding skills, so have an approach that identifies and evaluates this. And considered how to engage your non-technical staff – invest in the career paths of excellent employees.
- They want to see code in action. The companies that offer the best pay-outs in terms of financials and perks are often lacking when it comes to less tangible rewards like job satisfaction. The bigger the company, the smaller your role is likely to be, at least at the start. The best developers are people that are willing to take a risk and make a bet on a company that’s paying a little less than a big giant, simply because they want to make a difference and see their code in action or to learn something super new.
Finding and developing the right skills
As Chancellor Rishi Sunak announced the new bonus for employers to hire apprentices the importance of apprenticeships in developing skills across all sectors is brought back into focus. This has never been truer though in terms of digital skills. For years now, the UK has been attempting to keep up with the demand for highly skilled digital professionals like software developers. To date, unsuccessfully as the skills gap has not been bridged.
The solutions to ensure we have the right skills to drive a digital economy start with realising digital is now fully integrated into all our lives. We see this reflected in the jobs market, where over 82% of advertised roles now require some level of digital skills. Also, we must appreciate the speed of change. The skills landscape changes quickly now, and demand for skills that hardly existed a few years ago is growing rapidly.
If we continue to see a digital skills gap in the UK, then we need to re-think, redesign and be more agile in developing and hiring. There was a clear shortage of tech talent before the coronavirus crisis, and there’s no sign that the demand for skilled digital talent is going to go away. So, developing the skills our digital economy requires will again be a key focus of employers, the government and training providers like us.