Offshore Software Development Rates: Comparing by Country and Skills

Many companies are now pursuing offshore software development to optimize hiring time and budget and access more affordable talent. The rates of developers from overseas may be lower due to the lower cost of living, which helps save finances and invest them in more advanced features for the software or other business processes.

Many ProCoders partners, for example, save up to 30% on engineer rates and up to 99% on HR expenses! Of course, your savings depend on the quality and reliability of your tech ally, but today, we will focus on comparing offshore software development rates by country.

If you want to analyze the global IT expert salary market, this guide is the place to start.

Offshore Software Development Rates by Country

Country/Level	Junior (per year)	Middle (per year)	Senior (per year)
Estonia	$38,616	$51,492	$64,368
Poland	$35,760	$47,682	$53,640
Albania	$13,140	$18,800	$28,704
Portugal	$25,749	$46,134	$51,500
India	$9,585	$17,973	$23,900+
Singapore	$53,232	$62,112	$79,848
Canada	$51,295	$59,923	$64,473
Brazil	$18,948	$26,052	$30,792
Mexico	$26,872	$56,552	$79,122

Europe, Asia, and the Americas—we’ve gathered information about the talent market in each region and software developer salaries according to expertise level.

Europe

Estonia

Estonia is home to around 6,500 employed professional developers, and the number is growing by 1.4% a year, making it one of Europe’s highest concentrations of tech talent per capita. The software development market size in 2024 is expected to be about $633,5 million, which is impressive even considering the 6.2% decline since 2023.

The country’s number of tech solution businesses is 2,041, growing at 2.3% a year.

Estonia also ranks 18th among the 132 economies featured in the Global Innovation Index 2022, underscoring its stellar reputation in the tech world. According to IBISWorld report, in 2024, the country is at the 24th place among 26 European countries.

The education system in Estonia, with universities like the University of Tartu and Tallinn University of Technology offering advanced courses in software development, artificial intelligence, and cybersecurity, plays a key role in building this pipeline of tech talent.

Estonian developers often collaborate with foreign-based companies. Hence, a good knowledge of English is a requirement for most developers. The similarities between Estonia’s culture and the values across the rest of Europe make it one of the top software development hubs on the continent.

Before moving to Portugal, ProCoders relocated its main office from Ukraine to Estonia, so we’ve felt the IT growth in the country ourselves. 

Poland

The Software Development industry in Poland, valued at $8.91 billion, holds a strong position as the 7th largest in Europe out of 26 EU countries in 2024, maintaining this rank since 2019. Despite experiencing an average annual decline of 8.5% in market size between 2019 and 2024, the industry remains a key player in Europe. In 2024, the sector employs around 91,365 people, showing a 1% growth in employment. Moreover, the number of businesses in this industry has increased by 3% since 2023, reaching 67,433 companies, underscoring the sector’s resilience and potential for future growth.

Albania

The Application Development Software market in Albania is set to generate $13.35 million in revenue by 2024, with an anticipated annual growth rate (CAGR) of 8.40% from 2024 to 2028, leading to a projected market volume of $18.43 million by 2028. In the broader Software market, revenue is forecasted to hit $51.83 million in 2024, with Enterprise Software dominating at $21.71 million. The Software market is expected to grow at a CAGR of 6.78%, reaching $67.39 million by 2028.

Albania produces approximately 3,500 IT graduates annually, contributing to a steady influx of tech talent. The capital, Tirana, is a vibrant hub for tech events, startup ecosystems, and R&D activities, drawing talent across various tech domains.

Albania has focused on improving access to education since the 1990s, achieving near-universal primary and lower secondary education. As of 2014, over 50% of the eligible population is enrolled in tertiary education. The country’s alignment with European standards, as part of the Bologna process since 2003, has reformed and modernized its higher education system, further boosting its tech industry.

If you want to build your product with real professionals having advanced engineering skills, Albania will be a good choice not only because of the professionals’ mentality but also because of the pleasant rates for development:

Portugal

The Software Development industry in Portugal is valued at $988.8 million in 2024, positioning it as the 19th largest in Europe out of 26 EU countries. This ranking represents an improvement from 2019 when it was ranked 20th. Within Portugal, the industry holds the 104th spot among 294 industries tracked by IBISWorld, a position it has maintained since 2019.

Over the past five years, the market size of the Software Development industry in Portugal has declined at an average annual rate of 5.2%. Despite this decline, the industry remains significant, employing 10,136 people as of 2024. The steady employment and market size suggest that the industry continues to play a vital role in Portugal’s economy, even amid fluctuations.

Asia

India

The Software Products market in India is poised for impressive growth, projected to reach $42.62 billion by FY2031, up from $14.82 billion in FY2023, with a CAGR of 14.12% between FY2024 and FY2031. The broader Software Services Export market is also on the rise, expected to reach $189.19 billion by 2029, with a CAGR of 4.53% from 2024 to 2029. India is home to over 250,000 IT companies and employs more than 4 million software developers. The IT industry reached $227 billion in FY2022, with Indian software companies recognized globally for their cost-effective and innovative solutions.

The Software Technology Parks of India (STPI) Scheme fosters software development and export, with IT/ITeS units registered under the scheme exporting an estimated $80.3 billion in FY2021-22. The National Policy on Software Products aims to position India as a global software product hub, targeting a $70-80 billion industry and creating 3.5 million jobs by 2025. The Union budget for FY2023-FY2024 allocated $11.77 billion to develop the IT and telecom sectors. This strong support, coupled with India’s extensive talent pool and policy initiatives, positions the country as a key player in the global software industry.

Singapore

The Software market in Singapore is projected to generate $2.06 billion in revenue by 2024, with Enterprise Software accounting for a dominant share, estimated at $0.86 billion. The market is expected to grow at a compound annual growth rate (CAGR) of 4.96% from 2024 to 2028, reaching a volume of $2.5 billion by 2028.

The Singapore government is pivotal in driving the growth of the Software Development market through significant monetary support and various initiatives. With SG$24 billion (US$18.1 billion) earmarked over the next three years, the government aims to help local businesses innovate and build capabilities for future transformation. This financial boost will support initiatives such as the Emerging Technology Program, where the government co-funds trials and adoption of technologies like 5G, artificial intelligence (AI), and cybersecurity.

Under the Startup SG Equity scheme, the Singapore government co-invests with private partners in startups requiring substantial capital and with longer timelines to profitability. For startups enhancing existing technologies, the government provides 70% of the funding in an initial investment round of SG$250K and offers a dollar-for-dollar match with private investors, up to S$2 million. These initiatives underscore Singapore’s commitment to fostering innovation and sustaining its vibrant software development sector.

The Americas

Canada

The overall software market in Canada is expected to grow at an annual rate of 4.47% from 2024 to 2028, reaching a market volume of $26.44 billion by 2028. Within this broader market, the application development software segment is anticipated to generate $5.71 billion in revenue by 2024.

Canada has a significant number of software developers and programmers, with high demand for this occupation. Job postings for software developers are widespread across the country. The median wage for software developers in Canada is $44.62 per hour, though this can vary based on location and experience. Key skills and competencies for Canadian software developers include digital production, troubleshooting, digital literacy, evaluation, and systems analysis. However, job prospects for software developers vary across different provinces and territories, indicating that demand is not uniform nationwide.

Brazil

The software market in Brazil is projected to grow at an annual rate of 5.82% from 2024 to 2028, reaching a market volume of $11.50 billion by 2028. Within this broader market, the application development software segment is expected to generate $2.55 billion in revenue by 2024.

The Brazilian game development industry is experiencing remarkable growth, with the number of game development studios more than doubling in recent years. The industry grew from around 500 studios in 2018 to over 1,042 studios operating in 2023, highlighting a thriving developer community. This robust expansion signals significant potential for Brazil’s software market, particularly in the gaming sector.

Mexico

The software market in Mexico is forecasted to grow at an annual rate of 4.23% from 2024 to 2028, reaching a market volume of $4.91 billion by 2028. Within this broader market, the application development software segment is anticipated to generate $1.23 billion in revenue by 2028.

Mexico is a global leader in IT services exports, with exports surpassing $21 billion, underscoring the substantial scale of its developer and technology services market. The country boasts a large and skilled talent pool, with over 700,000 IT professionals and developers as of 2022. This makes Mexico an attractive destination for software development outsourcing, offering a wealth of expertise and resources for companies seeking to leverage its tech capabilities.

What Should You Know?

Following an examination of offshore software development rates by country, business leaders must know what to expect when sending a project offshore and how much does it cost to outsource software development. This section covers factors affecting the cost of a project, tips for cost saving and cost-effective project implementation, and how to choose the right country and vendor.

Factors Affecting Development Costs

An offshore software development rates comparison is important in deciding which region to outsource to. Yet, software development prices vary widely based on different factors, like the price for every other thing. So we’ll look at factors that cause varying prices, from the more apparent to the less apparent.

Developer Expertise

This is surely the most obvious factor affecting the price of hiring software developers. Certainly, a junior developer cannot expect to be paid at the offshore developer rates of a senior developer. Likewise, a senior developer will not settle for being paid at a mid-level developer’s rate.

Note that this is context-specific as, in some locations, the offshore developer rates of a mid-level professional might be equal to or even less than that of a junior developer elsewhere. For example, the middle-level Central European developer’s hourly rate could be equal to or even less than the junior US developer’s. However, the point is that within similar contexts, software developers earn according to their levels of knowledge and experience, like all other professionals.

Programming Languages

There are many programming languages, each with varying degrees of acceptance. As a result, the software development market has an obvious skills gap, even though the gap is closing. However, some languages are still growing; as such, there aren’t many programmers who can code in that language yet.

Moreover, some specific skills like business intelligence developer roles and responsibilities, can cost more than you expect. These factors affect offshore software development rates comparison, but we can expect some improvement in the coming years.

Project Complexity

This particularly applies to contract projects. The more complexity is required to complete a project, the higher you will get charged. Many people prefer to outsource the entire project to software development agencies when a project is complex.

With the offshore outstaffing model, the client is charged by the agency, and all responsibility for paying individual developers falls to the latter. Therefore, you can save more money on particularly complex projects.

Location and Cost of Living

The location of the outsource company play an important role in determining its service cost. For example, if you choose a provider based in India or China, you can expect lower rates than if you choose a provider based in Australia or the United States. In general, some people think offshore developer rates are cheaper in certain areas simply because the developers from there are of lower quality. That’s not true. This is because labor costs in India and China are significantly lower than in other countries due to lower levels of living standards and salaries.

However, you should remember that although the amount of offers is huge on the market, it still needs time and money to find a good developer who will help you create a product of high quality.

For instance, Central Europe has some of the cheapest offshore developer rates; yet, it still appears among one of the best countries to outsource software development projects. The reason for this variation is usually the cost of living. In places such as Albania, Croatia, etc., when the cost of living is low, developers charge less because they can still satisfy their needs.

This is one of the reasons why many ProCoders clients consider collaboration with us: we employ developers from Central Europe, putting the cost and quality on the same level. Our clients are looking for reliability and the balance between quality and cost, so choosing developers from Albania, Estonia, Croatia, etc., is the best option.

Tips to Save Budget

Some ProCoders tips to save without compromising development quality:

• Opt for Outstaffing: Direct recruitment of software developers can be expensive. Instead, consider outsourcing development to an agency via the outstaffing model. This approach helps you save on hiring costs while accessing top talent.
• Consider Offshore Development: Offshoring your project to countries with lower development costs, such as those in Central Europe, can offer better value while maintaining quality. Agencies like ProCoders can help you set up a world-class team for your project.
• Prepare Thorough Requirements: Before beginning your project, have all the estimated requirements ready. Engaging an outsourcing agency can help you identify hidden costs that might otherwise hamper your project’s progress.
• Define Project Features and KPIs: Clearly define the key features of your project and establish the necessary key performance indicators (KPIs). This clarity helps in building a scalable team while avoiding unexpected costs, taxes, and fees.
• Use the Agile Approach: Implement an agile methodology for your project. The agile approach helps you work faster and smarter, avoiding common pitfalls. ProCoders uses agile strategies to work closely with clients and ensure smooth project execution.
• Consider a Discovery Phase: Conduct a Discovery Phase before starting your project to estimate the necessary steps and budget for development. Involving developers, UI/UX designers, and QA specialists in this phase can help boost your project’s success.

At ProCoders, we specialize in providing top-notch software development services through our highly skilled staff. We offer a comprehensive Discovery Phase, where our team of experienced developers, solution architects, and other specialistswork closely with you to precisely estimate the requirements, steps, and budget needed for your specific product. 

Our agile approach ensures smooth project execution and fosters a collaborative environment with our clients. We are dedicated to helping you achieve your project goals while maximizing efficiency and minimizing costs. 

Hidden Costs

When outsourcing software development, companies might encounter unexpected expenses that can affect their budget and project timelines. 

One common issue is unclear pricing structures, where agencies charge additional fees for services not initially disclosed. This could include costs related to project management, changes in project scope, or ongoing support and maintenance. In some cases, agencies may also charge extra for services like debugging, troubleshooting, or implementing updates.

Another hidden cost is related to communication inefficiencies. If the outsourcing partner is not transparent or has poor communication practices, it can lead to misunderstandings, delays, and increased costs for resolving issues or aligning on project goals. Time zone differences can exacerbate these issues, particularly if the outsourcing team is not proactive in managing collaboration.

Additionally, unforeseen legal or compliance-related costs may arise, particularly when outsourcing across different countries. This can include legal fees, licensing costs, or penalties for non-compliance with local regulations. It is crucial to ensure that all legal aspects and regulatory requirements are clearly defined upfront to avoid surprises.

At ProCoders, we prioritize transparency in every aspect of our business, from payment structures to daily communication and project updates. Our monthly installment system offers convenience and clarity, ensuring that our clients understand exactly what they are paying for without any hidden costs. This commitment to openness helps build trust and fosters strong, collaborative relationships with our clients, allowing us to deliver successful projects efficiently and effectively.

How to Choose the Right Region and Vendor?

By now, it is clear that while offshore software development rates vary by country, the cheapness of a vendor or region is not enough reason to select it for your project. So, what other factors matter in choosing an area and vendor?

• Skill Availability: The region you choose should have a robust pool of skilled developers and IT professionals who specialize in the technologies and services you need. Research the region’s expertise in specific programming languages or technologies relevant to your project.
• Cost Efficiency: While cost savings are often a driving factor in outsourcing, it’s important to balance cost with quality. Different regions offer varying rates for developers, so it’s essential to find a region that offers both affordability and high-quality work.
• Time Zone Compatibility: Time zone differences can impact communication and project timelines. Choose a region that aligns with your working hours or where the vendor offers flexible working schedules to accommodate your needs.
• Cultural Compatibility: Consider the cultural aspects of the region and how they align with your company’s values and working style. Cultural compatibility can enhance collaboration and lead to better project outcomes.

• Vendor Reputation: Look for vendors with a strong reputation in the industry. Check reviews, testimonials, and case studies to gauge their reliability, expertise, and customer satisfaction.
• Legal and Compliance Considerations: Make sure the vendor adheres to legal requirements and industry standards relevant to your project. This includes data protection regulations, intellectual property rights, and any specific certifications or accreditations.
• Communication and Transparency: Effective communication is key to successful outsourcing. Choose a vendor with transparent communication practices, regular updates, and clear reporting structures.

At ProCoders, we offer comprehensive outsourcing solutions tailored to our clients’ needs. Our skilled team, transparent communication, and convenient payment structures make us a reliable partner for software development projects. Contact us to learn how we can help you achieve your project goals efficiently and effectively.

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Conclusion

Offshore software development offers companies a strategic opportunity to optimize costs while accessing a global pool of skilled talent. By outsourcing to countries where the cost of living is lower, businesses can save significantly on developer rates and invest those savings into enhancing their products or other business areas. As demonstrated in our comprehensive ProCoders analysis, partners can save up to 30% on engineering rates and up to 99% on HR expenses through offshore development.

Understanding the factors influencing offshore software development rates, such as developer expertise, programming languages, and project complexity, can help companies make informed decisions. Additionally, choosing the right region and vendor based on factors like skill availability, time zone compatibility, and cultural fit ensures a successful partnership.

ProCoders, with its transparent communication, skilled staff, and agile approach, provides an ideal partner for offshore software development. By embracing offshore development wisely, businesses can access top talent, optimize budgets, and achieve remarkable project outcomes. For companies exploring offshore development, this guide offers valuable insights to navigate the global IT expert salary market and make strategic decisions for their projects.