Ask HN: What's the current job market and sentiment like for outsourcing shops?

34 points by ciguy 2 years ago | 47 comments

I'm thinking primarily of the Indian and Eastern European shops that try to hire junior devs and then pass them off as seniors and charge accordingly for simple outsourced web work. I got curious because much of this market seems like it was driven by cheap VC money for MVPs that has now dried up.

A few weeks posted an ad for a freelancer for a simple Node.js project on a few of the freelancer aggregators. It was to update a simple app to the latest Node versions and add a page. When I posted something like this just 2 years ago, I got maybe a dozen low effort replies and it was hard to get anyone to even agree to interview. Now I have received 100% quality applications from individuals and dev shops practically begging for the project. Some have even offered 1 or 2 weeks free work.

This got me very curious about the sentiment in these areas and how the devs are currently feeling. I know in SF the market in big tech companies has dropped off somewhat with the layoffs but most people I know found new jobs pretty quickly. Is it the same in India and Eastern Europe or has the drop in VC funding had worse effects? Just curious to get thoughts from anyone in that market on the general sentiment.

ageitgey 2 years ago |

I'm a CTO of a Series A start-up with open dev roles posted. Right now, my inbox is completely overwhelmed with emails from outsourcing companies offering to do the work. So based on that data point, I'm guessing there is a lot of competition for general outsourced work right now.

Part of this might because a lot of new start-ups got into this space during 2020-2022 acting as a light middleman between overseas devs and US-based companies while not providing much besides facilitating payment. So you have all the traditional outsourcing companies fighting it out with all the newer companies in an economy where spending is way down overall.

All that being said, it seems like great experienced devs in Eastern Europe are still getting snapped up quickly.

ciguy 2 years ago | |

I get the same emails. Everything you said makes sense. It's interesting to me that there seems to be little internal appetite for talented devs in those regions. It seems like they could create some really amazing software products if the domestic talent was put to good use and paid fairly.

HeyLaughingBoy 2 years ago | | |

I worked for an engineering services company that had a client in India. It made no sense to me: India is such a big hub for outsourcing talent at much lower cost, so why wouldn't they stay local?

It turned out that US engineering talent was considered to be higher caliber, and being able to say that their product was developed in the USA gave them more access to Indian investors.

Who'd a thunk it?

fatnoah 2 years ago | |

> Right now, my inbox is completely overwhelmed with emails from outsourcing companies offering to do the work.

I'm getting dozens of emails and phone calls plus a few LinkedIn connection requests daily. It's a far, far, far greater number than I've seen anywhere in the past. I'm used to a few every week, not a near constant stream.

fxtentacle 2 years ago | |

Same here

And we don't even have any job openings posted. We used to get applicants for non-existing openings in broken English straight from India... and now we get applicants for non-existing openings in ChatGTP English straight from India ^_^

My impression is that since mid 2022, there are A LOT of outsourcing companies who urgently need something to do.

deltasquare4 2 years ago |

As someone who runs a niche dev shop in India (not the kind that you describe though), I have found that new work has been hard to come by since last 6 months, especially for services like ours that are on the premium end. Even the general consensus around my network is the same.

The Indian dev "market" was pretty much commoditized during the pandemic, which prompted us to move our focus away to niche that could still pay premium for high skills and outcomes. It seems that rest of the market hasn't changed much even in this time. I can't speak for the job seekers, but the number of job applicants applying to us have risen sharply over last 2 months or so.

ciguy 2 years ago | |

That makes sense. Working with developers in India has always been frustrating to me. There is so much talent and potential there but it just gets drowned out by the noise of so many scams and low quality/effort grifters that it is hard to justify the time needed to find someone who can actually deliver. I am sure on your side it's frustrating as well trying to break through and be seen for the high quality work you do.

deltasquare4 2 years ago | | |

It is. It creates two "problems" - our quality and price both are directly compared to the other shops, and the quality part is not always immediately visible.

mousetree 2 years ago | |

I'm curious to know what a "niche" dev shop is? Do you focus only on some industry vertical? Specific technology?

deltasquare4 2 years ago | | |

Well, we focus on building high-traffic/large-scale apps. The tech stack does not matter. Our skills are easier to demonstrate if customers have existing performance/design bottlenecks. Not something that other dev shops can claim to do easily.

pighive 2 years ago | |

https://www.rmenpara.com is 404!

moneywoes 2 years ago | |

as someone interested on business what was that pivot like, moving to a specific technology? how did your icp change?

lelanthran 2 years ago |

I'm a one-man shop, and it's been pretty hard.

Best work coming my way is always from non-tech companies. Companies whose core skills include tech pay very poorly, ask for a lot and come with the downside that youll be working on their current stack, so you get no choice over what tech to use

ciguy 2 years ago | |

That's interesting to hear. I would have expected tech companies to come with more reasonable expectations/pay and better defined requirements. Best of luck to you and I hope things turn around soon.

eitally 2 years ago |

I was in Google's partner org for 8 years and recently joined a cloud services company, but one that specialized in product engineering rather than "normal" system integration work. I've found that there's a glut of traditional SI partners, all of whom promise the latest & greatest tech, the most skilled technicians, and the highest CSAT. If you don't know the space, you'd be forgiven for assuming they're all roughly equivalent, but that's not remotely true.

There is a glut of outsourcing shops but there's also a wide gamut of specialization, and it can be difficult to choose the right partner for a given job. Some areas are far more commoditized than others (general cloud migration or general systems administration or general appdev, vs data analytics platforms for specific industry use cases, building regulatory compliant stuff, doing BPO in spaces that require deep domain knowledge, etc. I would never trust Accenture to do product engineering, and I would never trust [insert small generalist SI here] to do business strategy consulting. But even those aren't hard & fast rules.

Consulting and outsourcing shops exist for a reason, and those reasons aren't going away. The market is huge, and although there's been a dip over the past year with the Ukraine war and global macro-economic challenges, everyone expects things to recover and most of the big consultancies have been using this time to both "right size" and refocus to ensure they're ready to help companies of all sizes reach their growth ambitions.

iamflimflam1 2 years ago |

I don’t think people have realised just how much of a knock on effect the drying up of funding is having.

I remember the dot com days. Companies that used to be spending stopped. All the “we’re selling the picks and shovels” and the outsourcing/body shop companies suddenly had no customers. It was horrible.

drinchev 2 years ago |

As a contractor, based in Berlin, I also noticed that since the end of last year the market slowed down.

0xDEF 2 years ago |

My only pleasant experience outsourcing to India was a native Android app. I think it helped that the two (young) devs had grown up with smartphones.

jacknews 2 years ago | |

The problem with india is that they have thousands of bootcamp/degree mills churning out 'software engineers', that they then try to sell as experienced seniors.

Then any given project is almost by necessity actually more than one 'programmer 'pretending to be that senior, and they are all often working multiple projects at the same time. It's a surprise that anything works at all.

EricRiese 2 years ago |

It's the same people replying. They're just using chatgpt to make their replies more professional.

ciguy 2 years ago | |

Some of them definitely used ChatGPT, I can see the signs of it. But that doesn't explain why I received 100s of applications this time around vs maybe a dozen or so before.

onlyrealcuzzo 2 years ago | | |

Maybe instead of sending you one email they hand wrote, they send you 20 emails from ChatGPT from different email accounts to increase their odds of winning the bid?

myth2018 2 years ago | | |

Hi. Would you mind to elaborate on which signs of ChatGPT you have detected? Not only out of curiosity: I've read that detectors are more prone to emit false-positives when analyzing text written by foreigners and, since that's my case, I'd like to learn how to avoid planting such signs into my own writings.

postsantum 2 years ago | | |

Perhaps because the cost of tailoring an application for your needs has dropped to zero?

jononomo 2 years ago |

I wonder if ChatGPT has resulted in less demand for basic web dev services.

reillyse 2 years ago | |

It has not. It’s way to early to see any market affects from chat gpt.

ciguy 2 years ago | | |

Not sure about web dev but many of the applications I received from freelancers this time around had obvious signs of ChatGPT use in them.

EricRiese 2 years ago | | |

GitHub copilot was first released 2 years ago