AI and Globalization Are Transforming the Developer Landscape

The field of software development is experiencing major transformations. Recent surveys indicate that developers around the globe find generative AI incredibly beneficial, with nearly 40% already incorporating it into their work.

The industry is evolving in other ways as well: in 2020, the number of GitHub users from lower-income countries surpassed those from wealthier nations, and projections show that India is set to surpass the United States in user numbers in the coming years.

These shifts are significant because skilled programmers are highly valued, with salaries to match (see Chart 2). In the U.S., the average developer’s income is among the top 5% of professions, enabling coders to earn more than even some nuclear engineers.

Despite AI’s advantages, its utility still has limits. When Evans Data surveyed programmers on the time saved with AI, the most common response—given by 35% of respondents—was between 10% and 20%. Much of this time savings comes from creating standard “template” code, but the tools are not without flaws.

A survey by cybersecurity firm Snyk found that over half of organizations encountered security issues with AI-generated code. Moreover, AI is not yet capable of solving more complex programming problems.

Bain, a consulting firm, notes that actual coding comprises only about 40% of a software engineer’s job. AI tools could make programmers more versatile, enabling quicker shifts between languages and broader applications of their skills.

In the past, even small applications might have needed teams of six to cover different areas like user interface and backend architecture. Jennifer Li from venture firm Andreessen Horowitz observes more startups now operating with smaller teams, as developers become capable of handling a broader array of tasks. Many companies also report that onboarding new developers to their software environment is becoming faster.

Most of these developments seem to benefit less-experienced engineers (see Diagram 3), allowing them to tackle more complex tasks quickly, while some responsibilities they previously held can now be delegated to non-specialists.

This evolution in coding has another implication: entry-level developers in wealthier countries are likely to face increased competition from abroad. Evans Data projects that the programmer workforce in the Asia-Pacific and Latin American regions will grow by 21% and 17%, respectively, from 2023 to 2029, outpacing North America’s 13% and Europe’s 9%. This trend indicates that offshoring and outsourcing will likely remain robust. Consulting firm Everest estimates that about half of all spending in the sector goes toward outsourced work, including software development.

The full implications of rapid AI development for developers remain unclear. A positive outlook envisions machines handling the most repetitive aspects of software creation, freeing up developers to concentrate on more complex and impactful problems.

Source: The Economist. Main illustration: The Wall Street Journal.

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