Covid-19 vs Online Businesses & IT Industry - Who actually won?

We can all agree that the pandemic of the Covid-19 affected many different aspects of our lives and it really changed the rules when it comes to the global marketplace. The economy experienced a real temblor and there is no doubt that it will take years before the consequences of the Covid-19 fade away – if it ever truly occurs.

Only in 2020, when everything took a dark turn, more than 114 million people lost their jobs, but what exactly happened with “remote workers” and developers that could perform their work from home?

That is a totally different story and what really shocked us is that recruitment activity and number of job postings increased wildly while the number of candidates decreased from the period before the pandemic.

Demands increased 2.5 times while the average number of applications per job fell from 3.3 in January to 2.4 in June. That leaves us with the conclusion that the coronavirus actually accelerated the transition from office jobs to remote work in a matter of months.

‍

Demand for developers is growing daily

Developers are usually not as impacted as other jobs in other sectors when some economic upheaval occurs, but the pandemic of Covid-19 hasn't left developers out of this whole mess that is conducted, and very suddenly, everything went online. From groceries, clothing, businesses, hiring, and finding jobs, everything switched to the online sphere.

Turning point for developers

Since the IT sector was growing rapidly in the last decade, it was only logical that a remote way of living would take the wheel but we had no idea it would happen so soon. When businesses realized that coronavirus is not going to disappear in a long time, that is when the demands for developers started growing.

New e-commerce platforms and applications arose every single day, and while that became largely positive for all IT technicians, Covid-19 also impacted the upstream supply for the IT sector but mostly software developers. Travel embargos, limited access to educational credits, and delays in student visa processing, all played an important role in significant declines in graduate-level enrollments in computer and information science this year. This means the expected graduation rate will surely drop down in 2021 when it comes to the IT Sector.

This decline will decrease CIS post-graduates by 11.700 students in 2021 and that is why experts are already anticipating a tighter IT labor marketplace, especially when it comes to higher-skilled IT jobs.

New opportunities due to pandemic

With many companies shutting down or laying off their employees, many tech developers felt insecure about their job positions as well, but they had one important fact on their side – new, online-based platforms rapidly started appearing and new job positions quickly overcame the existing IT specialist’s supply.  

Since people had to forget about life before Covid-19, they realized that the internet is the only source of money during the pandemic, so they started investing in online applications, products, platforms, etc., and the only way to hire a team was - remotely.

Nowadays, hiring people and applying to remote jobs is just a regular activity that software developers bring to us. Shopping for groceries, visiting our favorite fashion brands, even getting coffee, everything is now available with only a few clicks on our smartphones – once again, thanks to developers.

The e-commerce sphere was increasing in the pre-pandemic period as well, but people never felt this safe while shopping online, many huge brands had to make a transition in order to stay competitive or even running in these hard times of coronavirus. The developers had to work double, or even triple, to make our user experience as great as possible and with that, keep many businesses from shutting down.

How Covid-19 increased hourly rates and salaries of developers

Before the pandemic, the U.S. Bureau of Labor Statistics (BLS) estimated that approximately 1,469,200 full-time software developers were working in the U.S. in 2019 with an average salary of $107,510. The indication is that over the next 10 years, the U.S. labor market will increase for 316,000 developer positions which is an outstanding 22% growth rate. The 43% decline in new CIS graduates reported by the ACE would reduce BLS estimated job growth by 38% in 2021 by leaving thousands of jobs unfilled.

Budget for having A-player developer significantly increased

As the demands started increasing, developers didn’t have to set for less, and soon enough, they realized their worth. That was the moment when businesses and recruiters had to step up the game in order to keep developers in their companies.

Since new, remote job openings for developers started rising every day, developers could easily choose where they wanted to work and the location was not a burden anymore. Since the whole world switched to online games, the competition between companies in the terms of finding new developers, spread to the whole world. Large businesses and brands had to switch to e-commerce platforms and many developers were already “stolen” and hired by famous recruiters, which really affected small businesses or especially start-ups.

Every high-skilled developer became a very “expensive component” and not every company has that large budget to keep the developer position filled. High hourly rates and salaries incapacitated smaller businesses to stay competitive on the marketplace, and developers didn’t love their standards – which is completely reasonable.

Developers aiming towards more popular companies

In order to stay alive in this outrageous market, companies cannot wait for positions to become hard-to-fill and unfilled that will initially lead to poor productivity and decreased innovation. Companies can take two strategic steps to attract and retain high-skilled employees: establish a dual career path for technical staff, or/and invest in employee education and training.

Bennett and McGuinness found that hard-to-fill vacancies reduced productivity levels by 65%, while unfilled vacancies reduced productivity levels by 75%.

Many developers aim to switch to more attractive and famous companies, but what does make one company “attractive”? What makes a company attractive to a prospective employee is partly the skills that a prospective hire feels they can develop and learn on the new job. One analysis of employment data from over 50,000 workers found that employees can accept lower salaries if they are given an option to work with novel and emerging IT Systems and the opportunity to learn new skills.

Also, a very interesting study from HRTechnologist showed exactly what developers want the most from companies they are applying for when searching for a job, and we according to our experience, we couldn’t agree more.

‍

Why is salary low-balling new hires history?

Covid-19 did some good to the IT Sector and low salaries are pretty much history for those employees, especially if we are talking about high-skilled experts that have 2+ years of experience.

The coronavirus changed the rules and it’s not companies that are setting the rules anymore, but the employees themselves – in the IT field. As we already mentioned, the developers realized the number of opportunities they are given, and they are also faced with higher hourly rates than before Covid-19 which gave them the freedom to set their own standards.

What was the “ordinary normal” to give much above hourly rates now became impossible because of the rapid increase of open dev positions that are giving much higher salaries. With remote working being established as a “new normal”, developers did not have to worry about their job status, they had a world to choose from.

Because of the importance that IT professionals have in terms of keeping business alive through the pandemic, it is only logical that companies will have to “sacrifice” their budgets and give developers what they ask for if they want to stay in the game. 

‍

Is Eastern Europe still the best place to hire new developers?

Absolutely.

Eastern Europe has always been known for having very skilled talents with very good English. However, due to the (usually) bad economy of countries of Eastern Europe, their rates varied a lot.

That caused the same level of experts to work for two totally different rates. That was definitely the benefit for employers, as developers were practically fighting over jobs, but it was super bad for developers as general rates per hour were less due to other experts working for less. 

But now times have changed.

As we previously mentioned, demand for developers is rising on a daily level and developers know it. We’ve seen a change in rates Eastern European developers change over the last year and it’s no wonder.

Unique solution to market diversity problem

Here at Devop.One we have a large pool of Eastern European developers who are true experts in their industries. Not just that our resources remained intact over a pandemic, but we even built a bigger community and pool of true experts.

Most of our clients at Devop.One are struggling to find the top 1% of developers in the world, and regardless of rates, such developers are often to be found in Eastern Europe.

So far, we’ve connected hundreds of developers from various categories with the fastest-growing companies and the world and if you find yourself in such need, reach out to us, we can help! Also, make sure to read how we helped an amazing company find an incredible DevOps engineer, that will give you great insight into how things work!

‍

Digitalization of businesses is future

Even before the Covid-19 pandemic, the world slowly but surely started adapting to this online world, sites like Amazon or eBay were developing rapidly but if it wasn’t for the pandemic, it would take years and years to reach the current state that humanity lives in.

Because of the restrictions, in order to maintain profitable and competitive market growth, they have to adapt to new features, techniques, and advanced technology, which means they have no other choice than to develop e-commerce strategies and platforms. Every aspect of human life has been affected, so must businesses.

In a matter of months, we, as humanity, had to adapt to new challenges that Covid-19 brought to us, and when companies realized the dark turn it may take if they stay static, that is when everything started changing. Small to medium-scale businesses also focused on adapting new technologies and they started investing more into a digital sphere of life. That was the first step for them in surviving and getting alive to the post-pandemic economy.

Software developers and IT experts proved crucial in helping companies survive the world pandemic of coronavirus and the future of business only depends on how well they will adapt to the new technologies and the times that are ahead of us.

Let us do the heavy lifting

One is sure - here at Devop.One we’ll keep connecting amazing opportunities with the top 1% talent in the world. 

Our business grew so much now when digitalization and online businesses started blooming, and our pool of incredible developers, marketers, executives, and managers was never stronger.

Looking for a new A-player in your team?

Let us do the heavy lifting!

Contact us, we’d love to hear from you!