When it comes to the future of the tech industry, everything rides on the quality of its workers. But we’re facing two main issues.
First, there’s a widening gap between the skills companies are looking for and the skills workers are being trained in. It’s estimated the skills gap will contribute to around 2.4 million positions being left unfilled between 2018 and 2028. It’s difficult for companies to scale their tech teams when they are unable to find candidates who align with their needs.
Second, demand for tech workers currently outweighs supply. Businesses are becoming increasingly digital, and many of them offer software as a service or rely on complex user interfaces. There is very high demand for staff capable of meeting companies’ technology needs, especially because companies that fail to keep up with modern digitization efforts lose an average of $7 million. It is paramount that we prioritize our tech teams and empower them to do excellent work.
But even if we want to build well-staffed tech teams, issues like high rates, low retention, and recruitment challenges can get in the way. How do we overcome these roadblocks? I believe the best path forward is a new, innovative form of outsourcing called staff augmentation.
What is Staff Augmentation?
Traditional outsourcing involves relying on an external team who you have little direct contact with. In contrast, staff augmentation is a form of outsourcing that integrates contractors into your in-house team. These augmented staff work directly alongside your employees and can easily collaborate.
Staff augmentation can allow companies to locate great talent that aligns with their needs, thus overcoming hurdles like the talent shortage and skills gap. It’s likely that an increasing number of companies will begin partnering with staff augmentation firms due to some tech industry predictions.
What Might We Expect Heading into 2023?
1. Personally, I foresee a continued acceleration of fully remote work and an increase in digital nomads (people who leverage remote work in order to travel more freely and live abroad). Fully remote work, I expect, will continue to remain popular for at least another 5 years. This means companies that might have previously avoided hiring remote staff will now be more open to staff augmentation, which involves contracting remote workers.
2. Along with companies’ increasing openness to remote work, there will also be a continued rise of Latin American tech talent. I believe that raw talent is equally distributed across the globe, but different countries have not had the same chances to develop skills. In recent decades, Latin America has gotten this chance.
When oil production in South America began to rise in the 1970s and ’80s, this led to the founding of more rigorous schools focused on science, technology, engineering, and math (STEM) fields. While the priority was petroleum engineering, there is a shared educational foundation for oil engineering and software development. South American countries like Colombia, Brazil, Ecuador, and Venezuela had the opportunity to increase the baseline education of their home populations. This has led to improved skills pertaining to other STEM jobs, not just oil production.
Ecuador’s capital city, Quito, has especially become a technology hub in recent decades. Quito and other Latin American cities like Chile’s Santiago and Colombia’s Medellin have begun to rival the U.S.’s Silicon Valley as Silicon “Vallecitos.”
This leads me to mention nearshoring, a staffing model whereby you contract hires who work in your same time zone but are located outside the United States. For North American companies, their nearshore staff would typically be located in South America. Nearshoring allows companies to avoid the high rates of hiring in-house tech workers and also avoid the communication delays that come with outsourcing to overseas teams.
With Latin America’s booming tech industry, this makes countries like Ecuador perfect for nearshore staff augmentation, or contracting augmented staff who work in your same time zone.
3. I also foresee an increased demand for the perfect blend of hard skills and soft skills.
With more countries having better access to quality STEM education, it’s become easier to find candidates who are technically qualified on paper. But an influx of technically trained staff has helped companies realize they also need to prioritize soft skills—communication, collaboration, initiative, common sense, and leadership. Such skills allow for greater team synergy and innovation, which benefits companies and their customers.
Soft-skilled employees also help with retention. And in order to reduce turnover, we need staff who value opportunity and work culture, not just salary. This requires that our teams have a certain level of emotional intelligence and that they feel personally connected to the work they produce and the companies they partner with.
And in order to create team harmony and preserve a healthy work culture, we need to be choosy about the personalities we hire. Policies like Netflix’s refusal to hire “jerks,” for example, protects team morale and makes staff less likely to go looking for a new job.
With nearshore staff augmentation, U.S. organizations can find remote staff who have both the hard skills and the soft skills they need to reach companywide success.
These three factors—increased remote work, improved technical training in Latin America, and the increased value of soft skills—mean that most U.S. companies are well positioned to take advantage of nearshore staff augmentation. Nearshoring allows access to great talent at a sustainable cost, but companies can thrive only if they instill a robust work culture and values in their staff.
As CEO and Founder of Jobsity, Andre Garzon and his team have provided leading companies with highly skilled software developers from South America as an extension of U.S.-based teams for a decade. Jobsity is a nearshore staff augmentation partner of choice, enabling U.S.-based businesses to scale their software development operations by connecting them with the top 3% of nearshore developers.