Recession. What is the risk to Software Developers?

What does the recession mean for you

 Yesterday it was formally announced that South Africa is in recession. Recession is a terrifying word for most people but does it mean Armageddon to the software Development world?

In my opinion, the only difference between yesterday and today is that it has been named. Over the last 4 years, South Africans have become steadily poorer (both business and individual) due to decisions at higher levels. We have effectively been in recession for years now. Ultimately nothing has really changed; you, me and your employer are poorer than we were 4 years ago whether we are in recession or not – the swing on the numbers is less than a percent. People far cleverer than me will comment on this. My main concern is the human element.

 The label, “recession” however is serious and has implications for all of us in reality.

The fear and anxiety associated to the name recession are what will hurt us. Consumers stop spending, CFOs stop spending, prices go up. There is less money available to get the same job done than there was yesterday.

The people around you will start becoming significantly more aware of the risk associated to spending money. This has an impact on hiring decisions.

Our software development industry is a wonderfully vibrant, rich one; it is unlikely that we will see the sweeping collapse that we saw in the 90’s after the Dotcom bust but you need to be more astute than ever to hit your goals.

Let’s be fair, all of you are probably more intelligent than this grey Recruiter but, my 5c follows…

 From a Software Developer POV:

You will be under more pressure financially. You and I earn less today than we did yesterday.

Business, however will be far more pedantic about what they want for the price they are prepared to pay. Your offer will not come from Tech but from HR and Finance, they don’t have an emotional connection to you, it’s their jobs to be stringent about money spent. We can’t blame them, this is their mandate and if they do a poor job, they get fired.

Most of you complain to me about being underpaid. Now is the time to become very conscious of your influence within a business. If you WANT to be an “Outlier” (big increases and big bonuses) you must behave like one in your delivery and knowledge.

There will be businesses who will pay for your skill but the psychology of a recession is such that you need to play a risk game. Make sure you invest heavily in businesses that can ride a recession out, make sure you invest heavily in your skills. What can you do to make yourself more valuable than the next software developer?

 From an Employer POV:

Times are tough and people are going to look for money wherever they can. You may not have massive budgets to throw at the problem. Be conscious, there will be businesses that do. There will be people going after your Devs and selling them the dream. From a retention POV, you must be far more vocal / conscious of what’s running through your staffs heads. Be conscious of what you can control, even if money is not one of those things. Obviously it’s often first choice to make sure your increases and bonuses don’t drop, using your staffs salaries to cut costs will result in them talking to someone like me. However there are other ways to make sure you continue to contribute to peoples quality of life. What can you do to protect retention of your IP?

 Ultimately, I don’t think there’s a need to panic. The damage was done pre this announcement. You must however be conscious of the mentality of your target market. We’re all under pressure, value and ROI to both parties becomes key to a win for both. We’re unlikely to see floods of retrenchments (Software Development, I can’t comment on other industries) but if we do our industry can absorb you ASSUMING you have maintained good skills health.

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