Over 2/3rds of UK businesses are feeling the impact and are on the search for solutions. And guess what? Offshoring, especially to India for software engineering, seems to be the hot pick. Keep on reading to learn more about the UK skill shortage and India’s move to bridge the gap.
According to an Open University study, UK businesses experience an annual deficit of a whopping £6.6 billion due to a shortage of skilled workers. All because of expenses related to recruiting candidates, providing training to workers with insufficient skills, and diminished productivity caused by gaps in staffing.
Over 2/3rds of UK businesses are feeling the impact and are on the search for solutions. And guess what? Offshoring, especially to India for software engineering, seems to be the hot pick. Keep on reading to learn more about the UK skill shortage and India’s move to bridge the gap.
Companies have long grappled with skill
shortages, but a recent UK government report highlights three turbocharging factors.
First, the digital revolution fuels soaring demand for software skills across all sectors.
Second, pandemic lockdowns accelerate digital transformation and trigger the "great resignation," depleting skilled developers.
Third, Brexit-induced reduced EU migration worsens skill gaps.
These dynamics sharply spike demand while plummeting high-value skill supply, impacting all UK industries, including IT.
IT faces the second-highest job vacancy rate per 100 employees [UK Gov].
Feb-Apr 2023 saw 50,000+ IT sector job ads [Office of National Statistics].
2023's tech talent pool is inferior to 2022's [Statistic].
Training and tech budgets offer solutions, but there’s a catch – they need time and funds, which, let's face it, are scarce resources!
There is, however, a far more popular option for overcoming the skill shortage in the UK.
A recent report indicates that IT leaders are going all in with a 38% surge in offshore development plans for the year 2023. This percentage rockets to 60% for firms with larger software teams. This shift totally makes sense. The other options are either doing nothing or going all out to try and attract local talent from bigger rivals, which can be costly.
Offshoring taps into skill-rich regions, expanding talent search beyond borders. Instead of just banking on the UK's small pool of developers, going offshore gives British companies access to top-notch software engineers from places with a talent surplus.
And when it comes to offshore possibilities, India takes the lead as the ultimate hub for forming dedicated software teams.
India's got the skills and the scale to create world-class software teams. A recent report forecasts India to house over 5 million software engineers by 2025, potentially even surpassing the US. Investment in STEM education, evident in 1.08 million computer science students, fuels this surge.
Bangalore alone, with its bustling tech scene, is home to a whopping 1 million engineers. But it's not just about the sheer numbers – India really nails it when it comes to English fluency and global teamwork experience.
India brings more to the table than just a big talent pool. With 60% lower living costs and 88% cheaper office spaces, it's a budget-friendly dream for tech. But while huge savings are possible, it's smart to take a balanced approach to maintain quality.
Offshoring might seem like a simple fix for the local talent shortage, but it comes with its own set of challenges that organisations need to know how to handle for the best possible results. Here are 5 of the most common offshoring roadblocks.
1. Sourcing capable engineers at the desired scale.
2. Handling operational models with limited control or visibility.
3. Bridging gaps between local and offshore teams amid cultural and linguistic differences.
4. Safeguarding against security risks and preserving intellectual property.
5. Effectively overseeing, motivating, and aiding offshore staff for sustained performance.
The answer to these challenges? Team up with an offshore partner to take care of those nitty-gritty tasks so that you can focus on what really moves the needle!
Unless you're a massive multinational corporation with abundant resources, partnering with an offshore ally is crucial. They offer operational infrastructure for rapid scaling and local expertise to navigate regulations. By leveraging their knowledge and infrastructure, companies can swiftly establish offshore teams for faster benefits.
However, not all partners are the same.
While some offshore companies focus on saving costs, they sometimes sacrifice culture fit, soft skills, and technical expertise due to tight budgets. Unfortunately, this can lead to high turnover as skilled engineers look for better opportunities elsewhere. But there's another way: a strategy that revolves around valuing your team, delivering top-notch quality, and planning for the long haul.
At The Scalers, we create offshore teams so well-integrated, they're not thought of as offshore by our partners.
What we offer:
So, can India really bridge the UK's skill gap?
India's potential is undeniable. With a ton of tech talent, impressive English skills, and a booming IT scene, India is the go-to solution for the UK's skills shortage.
By partnering with reliable offshore organisations like The Scalers, businesses can tap into high-quality talent, tailored recruitment, comprehensive logistical support, and a commitment to employee well-being.
With the right approach and the right partners, India's role in bridging the UK's skill gap becomes not only plausible but also promising.
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