Remote software developer salary: what’s the benchmark?
The shortage of tech talent in the United States is no longer a surprise. According to government reports, there are up to 1 million IT jobs 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. It is getting harder for employers to source skilled full-time programmers. This is partly due to the fact that the number of professionals is not growing fast enough to match the demand.
Another contributing factor is that there is a constant and rapid shift towards using new technologies. As a result, IT professionals do not have enough time to keep up with the pace of change.
The Pacific region, which is the biggest tech hub in the US, now faces the greatest skill shortage. The most severe skill shortages are in emerging areas relating to:
- Data analysis
- Cloud computing
- Machine learning
As well as more traditional tech roles such as:
- Software engineering
- Web development
Knowledge of Salesforce is amongst the most demanded complementary skills.
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 software developer companies face the need to look for remote workers from offshore and nearshore destinations and consider 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 the IT sector practice some form of remote work. Presumably, this is a way for companies to provide talented software developers with even better conditions. Sky-high salaries and amazing office environments are no longer enough to attract the best on the domestic market.
In the USA, 57% of the companies in the IT sector practice some form of remote work.
Aside from allowing your American developers to work from Alaska or Turkmenistan, here are some other remote software development models and ways of sourcing remote talent:
Option 1. Traditional outsourcing
One of the most obvious options that come to mind for most hiring managers is the traditional outsourcing model.
In fact, many outsourcing and software development agency companies have partners and sales offices onshore in the US. They can meet with clients in person before the 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. Most outsourcing software development agencies can offer both backend and frontend developers who come with a dedicated project manager.
Option 2. Sourcing high-quality freelancers
However, those who have experience with hiring freelancers will be aware that there is 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 form a remote team from scratch
- The communication skills of freelancers might be not high enough for a remote job
- Delivering on time
If we add all of these risks together, we will end up with elevated and sometimes unacceptable levels of risk.
Option 3. Remote contracting sites
Over the last few years, the number of sites or so-called job-boards where developers can apply for remote work has increased quite dramatically.
These sites often provide:
- Access to the CVs of developers who wish to operate remotely
- Clients with the ability to post jobs that are suitable for remote working
Here are some of the most known sites and their respective offers:
- Cybercoders has listed 41 remote developer roles just this week,
- RemoteOK offers contract job opportunities to those who want to work remotely,
- Indeed allows you to change geography and tap straight into local markets in offshore locations.
Option 3 is typically an improved version of Option 2. This is because contractors will limit the number of clients that they service to 1 or 2 during the contract period. It means that they can provide a degree of focus that freelancers often cannot.
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 and the hiring process itself;
- 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 such as YouTeam, VenturePact, and ModernWeb offer thoroughly vetted teams of software engineers. This can be a great way to find a developer who works remotely or even the entire software development team.
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. This allows clients to find a software developer on the basis of certain soft skills in addition to their knowledge of programming languages 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. This is because the company will no longer need to provide office space and other onsite perks.
- Junior software engineer: $25 per hour or $ 42,000 per year.
- Middle software engineer: $38 per hour or $ 63,000 per year.
- Senior software engineer: $68 per hour or $ 88,000 per year.
At the same time, the quality of work delivered will be almost the same as in the United States.
Hiring remote software developers for US Project: FAQ
We’ll put things mentioned above briefly here, plus add a few new useful sources.