Thursday, July 7, 2022

Australia’s Tech Sector in danger of following manufacturing to offshore

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A leading software developer is warning Australia’s tech sector could move offshore as wages nearly double in the past two years and a skills shortage sets in. 

“Annual wages for senior software developers have risen from 120K to 180K in the past two years while offshore talent is still only charging around $30K,” said Lambros Photios, Founder of Station Five. 

“What once took seven years to reach “senior” status now only takes three years as the skills shortage is so dire forcing companies to pay top dollar, elevating staff to more senior roles than they might otherwise have earned,” said Mr Photios. 

An analysis by KPMG has called for an annual migration intake to increase to 350,000 between now and the end of the decade, but attracting workers to Australia will be difficult now as the country is seen as a Fortress, an image cemented in the minds of many after the recent deportation of tennis world number one Novak Djokovic,” he said.

“Federal Government projections have the migrant intake returning to only 235,000 people a year from 2024-25.”

Mr Photios says the tech space is also at a crucial turning point warning the skills shortage in this sector could be the worst it has ever been. 

“In October 2014, GitHub (Microsoft) had Australia ranked 6th globally for open-source code. As of 2021, Australia is 15th – overtaken by Russia and South Korea,” he said.

“Until now, Australia has been seen as high quality with high standards and have always done well attracting good developers from the UK and Europe, but we are not seeing this happen at the moment and the Novak decision will not make it easier with a flow on effect with too much uncertainty around Australia.”

“The lure to come live Down Under, and enjoy our lifestyle is no longer a draw card.”

“Like manufacturing in decades gone by, Australia could see the tech sector move almost entirely offshore.”

“Pre-Covid, businesses in Australia could expect to pay local developers three times the salary of someone offshore like in the Philippines but businesses can no longer justify the difference.”

“People are also now being pushed into senior roles much faster in Australia taking three years instead of seven to achieve a senior developer role.”

“Like we saw in manufacturing, Australia won’t be able to compete and our talent pool will dwindle as South-East Asia drains the sector. Our loss will be their gain.”

Secondary editor and executive officer at Tech Business News. Contracting as an IT support engineer for 20 years Matthew has a passion for sharing his knowledge of the technology industry. He's also an advocate for global cyber security matters.

Matthew Giannelis
Matthew Giannelis
Secondary editor and executive officer at Tech Business News. Contracting as an IT support engineer for 20 years Matthew has a passion for sharing his knowledge of the technology industry. He's also an advocate for global cyber security matters.

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