Why Is Developer Pay So High And What Does That Have To Do With Bananas? By James Blackwell, Ceo, Ronald James

Issue 17

Over the last year, the average salary for a .NET developer in Newcastle has risen by 26%, and it's still rising. Of course, this is fantastic news for developers looking for a job; but it's rather less positive for any firms requiring these in-demand skills. So let's consider what might be behind this astonishing increase in pay.

Forget, for just a few moments, that you’re a hiring manager looking for the next great developer for the business. Imagine instead that you would like to buy a banana.

In normal circumstances, bananas are cheap. You can walk into any supermarket or corner shop in the North-East and pick one up for a few pence. That’s because bananas are plentiful, and there are more than enough for everyone who would like to buy one.

What would happen, however, if so many people wanted to buy bananas that they were suddenly in short supply? The North-East of England would be plunged into a “Great Banana Crisis” (we can see the Daily Mail headlines now). People are queuing in shops, demanding their share of perfectly curved, symmetrical, yellow bananas, prepared to pay whatever it takes to get what they want.

In the “Great Banana Crisis of 2016” the price of bananas has sky-rocketed; all because demand cannot keep up with supply.

The best bananas, those which command the highest prices, are only affordable for those consumers with the very deepest pockets. The rest have to make do with bananas that may be past their best. Or they may be forced to buy green bananas and invest considerable time and energy in nurturing them until they are ripe.

How does this relate to developer salaries?

So, we have just described the basic laws of supply and demand. And, clearly, developers are a product in just the same way as bananas. Anyone who lives or works in the area will know that, in recent years, Newcastle has seen an explosion in the number of digital technology companies.

This fact, and the correspondingly dramatic increase in demand for developers in the area, has driven the increase in salary levels. And to continue the analogy (to the point of distraction perhaps), many firms are being forced to on-board developers who are perhaps past their prime and bored with riding the next great technology wave. Not the perfect profile of a motivated team player although they may have the advantage of experience.

Alternatively, others are settling for green developers with nominal levels of experience in .NET and other sought-after technologies. With this compromise comes a long term commitment to training and internal support as they come up to speed with the realities of a commercial development environment. You may end up with a loyal, perfectly-formed developer. Or a first rate development diva with little loyalty and marketable skills gained at your expense.

Whilst the graduate output should, in the longer term, resolve the imbalance, vacancy rates at the ever-increasing number of Newcastle tech start-ups continue to rise and developer pay shows no sign of coming down anytime soon.

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