Comparison Guide: Software Developers Hourly Rates by Top Regions Worldwide
Today’s IT marketplace gives businesses the flexibility to outsource software development services to an overseas team. Offshoring opens new opportunities to select from a global talent pool while saving costs. However, the hourly rates for hiring a software developer vary greatly from country to country across different continents.
Here we have put together relevant facts and data to help businesses make a confident choice.
Current State of Outsourcing Software Development Worldwide
The outsourcing industry came into being in the early 2000s and has since grown exponentially transforming different sectors. Let’s look at some latest trends that show the current state of offshoring software development.
The value of the IT outsourcing market stood at USD 526.6 billion in 2021 and is expected to touch USD 682.3 billion by 2027, growing at a rate of about 4.13% a year.
The business process outsourcing market is forecasted to grow by a CAGR (Compound Annual Growth Rate) of over 7% a year reaching USD 76.90 billion during the forecast period of 2023-2027.
The recent trends show that more and more organizations are partnering with software outsourcing companies to onboard highly skilled professionals. The goal is to enhance core organizational processes, reduce costs, improve service quality, and facilitate transformation.
How Software Development Rates Have Changed over the Previous Years
The market trends have evolved drastically over the past couple of years and so have the software development rates globally.
In fact, there will be a 4% rise in the compensation sought by app developers for their software development services, and it will continue to rise for all technologies. Among these technologies come ReactJS, Python, React Native, NodeJS, Java and PHP.
Global Region-Wise Hourly Rates of Software Development
If you are looking to hire a software development team, this quick snapshot of hourly rates for software developers across the globe will come in handy.
Destination
Outsourcing Rates
Countries Included
Asia
$18 – $40
China, India, Philippines
Latin America
$30 – $50
Chile, Brazil, Argentina, Columbia, Peru, Mexico
North America
$38 – $63
Canada, United States, Mexico
Eastern Europe
$25 – $50
Bulgaria, Romania, Ukraine, Poland, Hungary
Western Europe
$20 – $45
Switzerland, Netherlands, Austria, Belgium, Germany
Africa
$20 – $40
Kenya, Morocco, South Africa, Egypt, Nigeria
Software Development Hourly Rate in the United States
With $38-63 per hour, the U.S. has the highest software development rates in the world. You can expect to pay salaries ranging from between $137k to $173k (inclusive of taxes and benefits).
Despite the high cost, the U.S. software developers are worth considering for the additional skills they bring to the table along with almost no language barrier and complete time zone availability.
City
Average per-hour rate
San Francisco
$62.5
Los Angeles
$52.5
New York
$59
Chicago
$48.7
Software Development Rates in Asian Countries
Asia is home to a huge number of software developers, making it a leading IT outsourcing destination. However, the hourly rates differ drastically from country to country. China, India, and the Philippines are the top three Asian countries offering high-value software and website development services.
In India, you can hire developers starting at about $18 an hour for a junior developer and reaching $40/hr for highly experienced professionals. The country is one of the most preferred outsourcing countries because of its affordability.
The Philippines is touted as the second-best country to put together your external software team. You can hire junior software developers at an hourly rate of:
Manila - $7-$12
Cebu - $9-$13
The third-best country to outsource software development projects to is China. Chinese developers rank 1st in all the HackerRank.com platform challenges, and the country today boasts over 50 science and technology industrial parks.
Countries
Average hourly rates
India
$6.72
Philippines
$5.62
China
$8.52
Software Development Rates in Europe
Europe is known for its qualified IT professionals available at cost-effective rates. For instance, Ukrainian developers are likely to be more budget-friendly in Poland. However, the average hourly salary for junior developers across Europe is $25 – $50 per hour. Belarus, Russia, Poland, The Czech Republic, and Romania are the top European countries to hire offshore development teams.
Western Europe
You can find dedicated offshore developers in Western Europe but the rates will be higher due to the high cost of living and taxation systems. You can expect to pay $20 – $45 per hour, amounting to an annual cost of about $60k.
Eastern Europe
Eastern Europe is a hotbed for start-up businesses. Plus, the market is full of developers skilled in software technologies and programming languages.
You can hire custom software development services in this region at $11-$25 per-hour rate. The average salaries that software developers make range from $40k to $70k (Poland being the most expensive).
In Ukraine, software developers offer their services for an average hourly rate of $26, paying $25 to $50 per hour for a software engineer. The time zones don’t vary much across most Western European countries.
Countries
Average hourly rates
France
$42
Germany
$32
The United Kingdom
$28
Bulgaria
$32
Romania
$35
Software Development Rates in Latin America (Nearshore)
The cost of hiring a software development team in Latin America is higher than the APAC and European regions, but still offers a cost savings over Onshore development costs.
Junior Developer: $25 – $34 per hour
Mid-level Developer: $50 – $80 per hour
Senior Developer: $100 – $120 per hour
Argentina
Since Argentina has its cultural and economic ties to Europe, European trends influence its IT market. The country is the most expensive destination for
hiring offshore development teams as their developers are highly experienced in working with western countries.
Colombia
Colombia’s IT market receives an additional batch of nearly 13,000 software developers every year. Most of these developers join offshore companies. The country benefits from American influence and has CMMI-certified companies.
Brazil
Brazil is often a clear choice for offshoring software and website development services. 8 of the top 10 technology universities are in Rio de Janeiro, and the global IT center is in Brazil. These universities graduate 14 thousand students in a year.
Countries
Average hourly rates
Argentina
$6.49
Colombia
$6.65
Brazil
$7.56
Software Development Rates in Africa
Africa’s IT industry may have just begun to take shape but is growing rapidly. Therefore, the country has gained significant attention in the global IT outsourcing market.
Recent reports predict that Africa’s IT business is expected to reach $180 billion by 2025. The industry will further contribute $712 billion in revenue, contributing 8.5 % of the continent’s Gross Domestic Product (GDP).
Top companies look for talented offshore software engineers (with Python, Ruby, and SQL expertise) in North African countries like Egypt, Morocco, and Tunisia.
South African developers often have high proficiency in English, German, Dutch, and other languages. Also, many developers skilled in C++, PHP, and SQL are available at reasonable hourly rates.
The highest number of software developers is in East Africa’s Kenya. Its capital, Nairobi, has an impressive IT infrastructure to support start-ups for technical innovation. Moreover, the software developers are skilled in SQL, Java, and mobile development.
Countries
Average hourly rates
Egypt
$20
Kenya
$20
Nigeria
$40
Morocco
$40
Tips to Recruiting the Right Offshore Software Developers
When deploying your offshore product development team, recruiting the right software developers is crucial. Managing an outsource team is never similar to managing an in-house team. Here are some areas to consider when selecting your offshore software development services provider.
Create a specific list of your expectations and requirements, like the tech stack they use, personal skills, experience, and knowledge of certain tools/frameworks.
Screen and evaluate potential developers for their core technician skills, like their ability to write codes efficiently in real-time. Check your candidates’ problem-solving approach by giving complex real business cases to solve.
Cultural compatibility can make all the difference, ensuring that their ethics and values align with yours.
Give your potential candidates strong reasons to pick you to work with. This approach will help you attract and retain highly talented professionals.
Engage your potential software developers in two-sided conversations where they feel free to exchange their ideas. This will promote their involvement in the project and make them feel excited to work with you.
Conclusion
More and more businesses today are choosing to outsource custom software development The reason: you gain access to a larger talent pool, a competitive edge, and the skills needed to develop robust digital products at a bargain.
VLink, headquartered in CT, with our other branch office located in Massachusetts and Global tech talent delivery centers in India, Canada and Indonesia is your reliable
offshore software development
company that brings an impressive package of experience, skills, and the ability to innovate and produce according to our clients’ unique ideas and requirements.
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to discuss how we can add value to your business as your extended IT team.