Software outsourcing is the business practice of hiring an outside organization to complete specific tasks that could be taken care of within an organization, like building a minimum viable product (MVP).
Software outsourcing has its merits, as well as its disadvantages, one of them being its inexpensiveness, especially with offshore companies, compared to building in-house teams.
As the costs of hiring a developer are relatively higher in Western countries, companies benefit greatly from the diverse and affordable offshore talent markets.
In this post, we compare software outsourcing hourly rates among six main offshore development destinations, look into each region in detail, and go over the hourly rates for some skills and programming languages in two locations.
All the rates were last modified in September 2020.
Global software outsourcing rates comparison
Software outsourcing rates (and the costs of labor in general) are higher in North America, Australia, and Europe compared to South America, Asia, and Africa.
For instance, the rates begin with 25€ for hiring a junior developer in North America and can go as high as 85€ (or much higher) with senior and more experienced developers.
In Australia, the rates for hiring a software developer begin with 21€ an hour and can go as high as 85€ (or even 152€ or higher). Software outsourcing is cheaper in Europe compared to the two previous regions, starting from 18€ and rising to 56€ an hour.
Whereas hiring a junior developer from Asia costs about 15€ an hour on average, and more experienced developers usually charge 34€ an hour or less.
Rates are moderately similar in South America and Africa, beginning with 17€ and rising as high as 42€ an hour based on a developer’s skillset.
You can see the average software outsourcing hourly rates by region below:
|Region||Minimum Hourly Rate||Maximum Hourly Rate|
Software outsourcing rates in North America
Software outsourcing rates are notably higher in North America than anywhere else.
Consequently, most North American companies choose to outsource their software products to cut their costs of product development.
|Junior Developer||25€ – 31€|
|Mid-Level Developer||32€ – 40€|
|Senior Developer||37€ – 52€|
|Lead Developer||43€ – 65€|
|Business Analyst||19€ – 29€|
|Project Manager||23€ – 40€|
|Junior Mobile Developer||21€ – 34€|
|Mid-Level Mobile Developer||25€ – 46€|
|Senior Mobile Developer||42€ – 65€|
|Junior QA||18€ – 27€|
|Mid-Level QA||32€ – 44€|
|Senior QA||37€ – 59€|
Software outsourcing rates in South America
South America is a popular outsourcing destination, especially for North American companies; many choose this region because of its reasonable prices, negligible time zone difference, and geographical proximity.
Hiring a junior developer from North America can cost up to 59€ an hour. A vendor from North America can cut its costs up to 25% if it hires a junior developer from South America, as they charge 30€ an hour, or less.
|Junior Developer||24€ – 46€|
|Mid-Level Developer||23€ – 50€|
|Senior Developer||27€ – 55€|
|Lead Developer||23€ – 59€|
|Business Analyst||19€ – 33€|
|Project Manager||34€ – 57€|
|Junior Mobile Developer||21€ – 25€|
|Mid-Level Mobile Developer||27€ – 39€|
|Senior Mobile Developer||38€ – 44€|
|Junior QA||28€ – 38€|
|Mid-Level QA||32€ – 42€|
|Senior QA||34€ – 50€|
Software outsourcing rates in Europe
Despite their geographical proximity, software outsourcing rates differ a lot in Eastern Europe and Western Europe.
Hourly rates are much lower in Eastern Europe (in countries such as Ukraine and Poland, two very notable IT nations), and double or even triple in some countries in Western Europe (such as Belgium and the UK).
The data we collected shows the average hourly rates in all of Europe, combining its Eastern and Western regions.
Europe is famous for its density of skilled software developers and a popular region for outsourcing, and most of its developers speak intermediate or upper-intermediate English.
|Junior Developer||7€ – 19€|
|Mid-Level Developer||25€ – 50€|
|Senior Developer||38€ – 59€|
|Lead Developer||42€ – 76€|
|Business Analyst||34€ – 59€|
|Project Manager||25€ – 50€|
|Junior Mobile Developer||21€ – 27€|
|Mid-Level Mobile Developer||27€ – 36€|
|Senior Mobile Developer||35€ – 52€|
|Junior QA||17€ – 42€|
|Mid-Level QA||21€ – 50€|
|Senior QA||25€ – 59€|
Software outsourcing rates in Asia
Software outsourcing rates are significantly lower in Asia because of its rather adverse work conditions.
China and India are the two main outsourcing destinations in Asia, each with a large number of software developers.
Western companies choose Asian outsourcing companies because they charge less than their Western nearshore counterparts, but dealing with language, time zone, and cultural disparities is almost always a challenge.
|Junior Developer||17€ – 21€|
|Mid-Level Developer||21€ – 25€|
|Senior Developer||20€ – 28€|
|Lead Developer||20€ – 29€|
|Business Analyst||21€ – 29€|
|Project Manager||20€ – 42€|
|Junior Mobile Developer||13€ – 18€|
|Mid-Level Mobile Developer||17€ – 23€|
|Senior Mobile Developer||25€ – 34€|
|Junior QA||15€ – 20€|
|Mid-Level QA||18€ – 22€|
|Senior QA||18€ – 24€|
Software outsourcing rates in Australia
Australia falls a bit behind in outsourcing and software development because of its geographical remoteness; this factor prevents the region from cultural exchanges and business cooperation with neighbor labor markets.
Even though a digital nomad lifestyle allows developers to work remotely with other companies from across the globe, managing time zone difference is extremely difficult when working with Australian developers.
Not to mention, the rates are high.
By taking a look at the Australian Skilled Occupation List (2017-2018), we realize that the country lacks skilled software developers and QA engineers. So, local specialists are expensive and charge up to 152€ an hour sometimes.
|Junior Developer||24€ – 46€|
|Mid-Level Developer||18€ – 51€|
|Senior Developer||24€ – 96€|
|Lead Developer||25€ – 39€|
|Business Analyst||15€ – 59€|
|Project Manager||23€ – 50€|
|Junior Mobile Developer||15€ – 46€|
|Mid-Level Mobile Developer||32€ – 50€|
|Senior Mobile Developer||29€ – 51€|
|Junior QA||13€ – 27€|
|Mid-Level QA||14€ – 37€|
|Senior QA||23€ – 67€|
Software outsourcing rates in Africa
The market is newly discovered and lacks experienced specialists due to its freshness in Africa.
The prices are more affordable in the Northern parts and offer similar prices as Asia. But in South Africa, the rates rise to 84€ sometimes; such fluctuation is caused by the severe skill shortage in the area at the moment.
The chart below shows the combination of Northern and Southern regions’ data.
|Junior Developer||3€ – 10€|
|Mid-Level Developer||9€ – 21€|
|Senior Developer||11€ – 37€|
|Lead Developer||10€ – 24€|
|Business Analyst||8€ – 25€|
|Project Manager||12€ – 25€|
|Junior Mobile Developer||1€ – 8€|
|Mid-Level Mobile Developer||9€ – 25€|
|Senior Mobile Developer||25€ – 39€|
|Junior QA||3€ – 6€|
|Mid-Level QA||4€ – 13€|
|Senior QA||6€ – 20€|
Hourly rates by skills and programming languages in the US and Germany
We have picked two locations to look into and compare in this section: the United States and Germany.
The charts below include the hourly rates for the most popular software development skills and programming languages in 2019 and 2020.
|Skill/Programming Language||Hourly Rates|
|Mobile||31€ – 42€|
|Product||42€ – 56€|
|Ruby On Rails||26€ – 34€|
|C||27€ – 36€|
|Python||30€ – 39€|
|Java||32€ – 43€|
|Linux||30€ – 43€|
|Backbone.Js||24€ – 38€|
|Agile Methodology||39€ – 53€|
|Maven||44€ – 50€|
|Product Marketing||39€ – 51€|
|Product Management||30€ – 40€|
|Agile/Scrum||39€ – 53€|
|User Experience Design||26€ – 33€|
|IOS Development||30€ – 40€|
|User Interface Design||21€ – 27€|
|Jira||26€ – 37€|
|Django||27€ – 62€|
|CSS||34€ – 42€|
|Project Management||49€ – 67€|
|Online Marketing||33€ – 43€|
|Android||39€ – 50€|
|Web Developer||23€ – 29€|
|Sales Strategy and Management||40€ – 56€|
|Business Strategy||39€ – 75€|
|MySQL||49€ – 67€|
|HTML||39€ – 48€|
|Digital Strategy||35€ – 50€|
|Web Design||23€ – 29€|
|HTML5 & CSS3||50€ – 65€|
|Web Analytics||21€ – 29€|
|Business Development||24€ – 34€|
|Graphic Designer||19€ – 24€|
|Social Media Marketing||34€ – 50€|
|Sales and Marketing||55€ – 72€|
|JQuery||37€ – 43€|
|PHP||29€ – 37€|
As we’ve already mentioned, the rates are significantly higher in North America compared to anywhere else.
The chart above shows the data concerning the United States.
Java takes the lead, with an hourly rate of 37-45€. Python comes after, with an hourly rate of €30-39, and C comes last, with an hourly rate of 27-36€.
|Skill/Programming Language||Hourly Rates|
|Mobile||9€ – 21€|
|Product||18€ – 38€|
|Ruby On Rails||14€ – 18€|
|C||9€ – 48€|
|Python||9€ – 71€|
|Java||9€ – 58€|
|Linux||14€ – 25€|
|Backbone.Js||9€ – 52€|
|Agile Methodology||45€ – 50€|
|Maven||67€ – 90€|
|Product Marketing||16€ – 74€|
|Product Management||62€ – 100€|
|Agile/Scrum||53€ – 60€|
|User Experience Design||25€ – 60€|
|IOS Development||9€ – 73€|
|User Interface Design||17€ – 47€|
|Jira||11€ – 22€|
|Django||17€ – 29€|
|CSS||8€ – 43€|
|Project Management||56€ – 59€|
|Online Marketing||17€ – 37€|
|Android||9€ – 56€|
|Web Developer||8€ – 43€|
|Sales Strategy and Management||15€ – 104€|
|Business Strategy||34€ – 63€|
|MySQL||13€ – 24€|
|HTML||14€ – 19€|
|Digital Strategy||16€ – 38€|
|Web Design||8€ – 57€|
|HTML5 & CSS3||8€ – 38€|
|Web Analytics||8€ – 57€|
|Business Development||15€ – 41€|
|Graphic Designer||9€ – 48€|
|Social Media Marketing||9€ – 24€|
|Sales and Marketing||11€ – 24€|
|JQuery||9€ – 23€|
|PHP||12€ – 26€|
The chart above shows the data concerning Germany.
The price range is wide in Germany, and the minimum hourly rates and maximum hourly rates can differ considerably.
Java takes the lead here as well, with an hourly rate that begins with 9€ and can rise to 58€. Python comes next with an hourly rate of 9-72€, and C comes last again with an hourly rate of 9-48€.
If we compare these three programming languages in the US and Germany, we see that the average price is much higher in the US, but the minimum and maximum rates fluctuate a lot more in Germany.
We’ve also written other posts about outsourcing; read Why Software Outsourcing Fails Most of the Time.
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