App developers will always be too expensive for businesses to have in-house

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The average UK app developer takes home £70,000 per year, according to recruitment company ReThink. This following a 27% increase in pay over the last year driven by demand for smartphone and tablet apps.
ReThink talks about the arrival of the app economy, which came about as a result of businesses interacting with customers via apps on devices such as smartphones and tablets, as being the engine behind the app industry's explosion.

At growth rates like this wages will be unsustainable for many companies who will turn to contractors or suppliers for resources in the short term. App developers will be a luxury to tap into for projects.

According to ReThink the app economy is serious business. "Whilst there are plenty of stories of independent developers becoming millionaires in a very short space of time, there are also a growing number of app development consultancies who are becoming big and significant employers. These consultancies are increasingly prepared to pay very high salaries for app developers with the right kind of skills."

But who will win?

Will it be the contractors or the service providers?

Either way a whole new IT industry has arrived and it is almost uniquely outsourced.

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Nonsense - this is just superficial fluff from an agency keen to attract CVs from mobile app developers with pound-signs in their eyes.

A quick search on a jobs site like JobServe shows that salaries for permanently employed Android or iOs developers range from £20K to £70k, but most are between £30-45K, i.e. roughly the same as for experienced Java developers (as you'd expect), and the average is obviously much lower than the rare top rate of £70K.

Contract rates are also broadly in line with Java developer rates, but of course contractors often have significant spells out of work between jobs (and mobile app developers may well be on shorter contracts than enterprise application developers), don't get paid holiday/sick leave, and have to fund employer's NIC, pensions, training etc themselves. Some contractors may land full-time contracts, but their costs are often higher, so even a gross annual income of £70K is not directly comparable with an employed salary of £70K (plus employer's NIC, plus pension, plus health insurance, plus holiday pay etc).

So if companies need a full-time mobile app developer, they can probably hire one for the same salary as a full-time Java developer i.e. £30-45K. If they need contractors to develop mobile apps on short-term projects, they can hire them at much the same rate as a Java contractor. And if they are taking on contractors on a long-term basis, instead of taking on full-time employees, then they clearly have more money than sense anyway.

And once Indian outsourcers ramp up their mobile app skills and start grabbing more of this work, you can expect rates for UK-based staff to fall anyway.

As for "millionaire" app developers, most mobile apps sink without trace, so if you want to be a millionaire, there are almost certainly better uses of your time.

No story here. Move along please.

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This page contains a single entry by Karl Flinders published on December 4, 2012 4:01 PM.

Is the Patriot Act really something to worry about when outsourcing? was the previous entry in this blog.

Who needs ERP software when people are so cheap? is the next entry in this blog.

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