India has long held the title of being the primary option for offshoring tech talent. The main reason? Cost. Considering the average salary of a senior developer in the U.S. is $103,496, while in India is $19,793, the difference is abysmal.
But is hiring developers from India the right fit for your business?
Time zones, communication, and cultural differences are some of the key aspects to explore that might hinder the benefits of saving money. Let’s go over the advantages and disadvantages of hiring developers from India.
Overview of the IT Industry in India
India, known as “the world’s back office,” has become a top destination for IT outsourcing and offshoring services. IT outsourcing dominates the market with a projected volume of $8.81 billion in 2023.
Revenue is expected to show an annual growth rate of 13.97%, which is projected to reach a market volume of $43.09 billion by 2028. This means that more than 240,000 IT companies in India will continue to multiply.
According to The Economic Times, the job roles with the highest growth since pre-pandemic are data engineer (353%), site reliability engineer (260%), assistant engineer (254%), application developer (235%), and cloud engineer (220%).
The Government of India is committed to creating an enabling policy and regulatory framework to support the continued growth of transformative technologies such as 5G, Internet of Things (IoT), Artificial Intelligence (AI), Cloud Technology, Blockchain, and Machine-to-Machine (M2M) communication.
These sectors have witnessed rapid expansion within India’s Information and Communication Technology (ICT) industry, significantly contributing to the nation’s socio-economic development. In order to harness the full potential of ICT as a primary driver of India’s economic growth, the government is actively formulating the necessary policy measures.
The evolution of these technological domains is poised to propel the studied market within the region.
Pros and Cons of Hiring Developers in India
Hiring developers in India offers the advantage of accessing a vast talent pool with diverse skills at a competitive cost. However, potential challenges may include differences in time zones and quality assurance, among others.
Let’s explore the benefits vs. the disadvantages of offshoring talent in India.
Advantages of Hiring Developers in India
1. Low Costs
One of the major advantages of hiring developers in India is its cost efficiency. Salaries for skilled senior-level developers in India are significantly lower than in Western countries.
|Location||Average Senior Developer Salary (USD)|
|Major Indian Tech Hubs|
|Bengaluru (Bangalore)||$20,000 – $35,000|
|Hyderabad||$18,000 – $32,000|
|Pune||$18,000 – $32,000|
|Chennai||$18,000 – $30,000|
|United States (New York, San Francisco)||$120,000 – $180,000|
|United Kingdom (London)||$75,000 – $130,000|
|Canada (Toronto)||$70,000 – $120,000|
|Germany (Berlin)||$70,000 – $110,000|
|Australia (Sydney)||$80,000 – $140,000|
Source: Glassdoor, Indeed, Salary.com
This cost advantage can lead to substantial savings for businesses.
2. Skilled Workforce
India has a well-established reputation for producing quality professionals. According to NASSCOM (National Association of Software and Service Companies), India produces over 1.5 million engineering graduates.
The region produces a substantial number of STEM (Science, Technology, Engineering, and Mathematics) graduates, with engineering and computer science being among the most popular fields of study. Additionally, Indian universities and institutes consistently rank among the top in global STEM education.
According to GILD, Indian coders are better at Math and Logic than American programmers when put to coding tests and rigorous exams. Among Its a diverse pool of developers specializing in the latest technologies like:
- Artificial Intelligence
- Machine Learning
3. English Proficiency
When working with remote developers, one of the aspects to prioritize is language. Communication is fundamental to avoid misunderstandings in remote teams and to build a solid work dynamic.
After the U.S., India has the second-largest population of English speakers, making Indian developers fluent in the language.
Disadvantages of Hiring Developers In India
4. High Staff Turnover
One of the common challenges businesses face when working with developers in India is the high turnover rates. Being a highly competitive industry due to its low costs, developers often receive attractive offers from other companies.
This can disrupt project continuity and require additional effort in recruitment and training.
According to industry analysts, it is projected that the attrition rate in 2021 will be approximately 22-23%. This translates to an estimated one million resignations from a workforce of around 4.6 million IT employees.
5. Quality Assurance
While India offers cost-effective development, it’s important to be aware that some projects may require additional quality assurance efforts due to variations in coding standards, practices, or interpretations of project requirements.
These differences can pose challenges in ensuring consistent and high-quality results. Employing a robust quality control process, including regular code reviews, becomes essential to uphold the desired quality levels.
While India offers skilled developers, a diligent and thorough evaluation process is essential to identify the best-fit candidates for your projects.
6. Time Zone Differences
India Standard Time (IST) is typically 9.5 hours ahead of Eastern Daylight Time (EDT) which often leads to challenges in scheduling meetings and real-time collaboration with development teams. It requires flexibility from both parties to accommodate different work hours.
Additionally, your team should have solid processes to ensure that projects can continue 24/7 without the need to have everyone working synchronously.
7. Intellectual Property Concerns
India remains one of the world’s most challenging major economies in terms of Intellectual Property. Businesses need to carefully manage and protect their proprietary information and ensure compliance with IP laws.
India has yet to implement measures to tackle long-standing intellectual property (IP) challenges that impact innovative sectors. The United States Trade Representative (USTR) has maintained India’s inclusion on the Priority Watch List, signaling ongoing concerns regarding IP protection in the country.
Start Your Hiring Process with DistantJob
Whether you’re in search of an Indian developer or exploring expansion into other talent-rich regions like Eastern Europe or Latin America, our team of expert IT recruiters is dedicated to ensuring that every candidate possesses not only the requisite technical proficiency and skills but also seamlessly integrates with your team’s culture.
Ready to hire global developers?