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OfferZen Updates: MERGE Presentation: Philip Joubert on Developers in South Africa
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MERGE Presentation: Philip Joubert on Developers in South Africa

28 January 2020, by Candice Grobler

Software has become the multiplier for business growth: When tech teams are working on what matters, companies thrive. When they aren’t, it can cost millions. In places like Silicon Valley, developers are highly respected, because they’re the people building things and shaping our future. This mindset is what lets Silicon Valley create the biggest tech companies year after year – but what is it like to be a developer in South Africa?

In this talk, Philip Joubert takes a look behind the numbers of our latest State of South Africa’s Software Developer Nation report.


Presentation transcript

Philip Joubert

[00:09] So, the topic of my talk is on the developer survey that we ran a while back. But before I really dive into the details of that, I want to share two ideas that serve as a kind of backdrop, which I hope will give you a different perspective that is maybe non-obvious.

[00:30] The first idea that I want to share is around the impact of software, and specifically that we are still at the start of the software revolution. Despite all the changes that have happened in the last few years with the advent of the internet and mobile phones and SaaS and the cloud and all of that, the biggest changes are still to come. In the startup world, that’s been coined as ‘software is eating the world’. ‘Software is eating the world’ can sound a little bit passive, as if there’s this sort of entity called ‘software’ and it’s going around disrupting things and potentially destroying some industries. But, of course, we know that’s not true. Software doesn’t create itself, at least not yet. It’s people that create software.

[01:30] And so that leads me to the second idea, which is that people are the foundation of software. If you want to build innovative products, you need to get the right people together and get them working in a sort of useful manner. Companies that fail to do that are going to get left behind. Stripe, the payments company, recently ran a survey where they asked executives what the biggest threats were to their business – what’s keeping them up at night. And it turns out that the thing that they’re worried about was access to developer talent more than access to capital. So, essentially, they were more worried about finding developers than they were about the money to pay those developers.

[02:19] So, those are the two ideas: Software is eating the world and people are the foundation of software. As Stephen found out, it seems that most of you know that we are a talent marketplace. Every month, our Talent Advisors talk to hundreds of developers and designers, data scientists and product managers about finding their next job, and during those conversations we hear about their frustrations with their current job, what they’re looking for in their next job, and generally what their aspirations are for their career. What we wanted to do was shed some light on those kinds of insights in a more structured manner, and so we decided to do a survey.

[03:07] The survey focused just on the developers in our community, and the reason for that was essentially just to keep things simple because it was our first survey and we were a bit nervous about making it a success. 3000 of you responded to the survey, which is absolutely amazing, so thank you very much for that. In the survey, you spoke about what it’s like being a developer in South Africa, what kind of technologies you’re excited about and sort of just general feelings and things about what it is that you look for in your next job. So, I thought a good way of tackling this is not to go through every single insight in the report because that’ll be fairly boring given that the report is available online. Instead, I thought what we could do is we could use the data to answer a question, which is, “Should I be a software developer in South Africa?”

[04:02] A good starting off point for that question I thought would be to look at what developers value. So, one of the questions in the survey was: ‘Apart from compensation, what are the factors you consider when looking for your next job?’ It turns out that the number one consideration that developers look at is company culture, followed by growth opportunities, flexible working hours, tech stack and diversity. I think this gives us quite a few interesting insights. The first is that South African developers care more about the environment in which they work than they do about the exact nature of the work that they do.

[04:42] As employers, I think, especially technical hiring managers, we often fall into the trap of talking about the technology and the technology problems that we have rather than the exact nature of the culture in which we work. I think it also says something interesting about the South African developer community, and that’s highlighted when we compare our results to those from a recent HackerRank survey. Despite culture being the number one consideration for South African developers, it barely makes the top five for developers in Europe and America.

[05:18] Fortunately, there are some signs that we are getting culture right in South Africa. The first one is that four out of five developers feel that they are respected and valued in the workplace. As you would all guess, that’s obviously a fundamental part of any successful culture – the respect that colleagues have for one another. The tech industry, globally, has got a lot of flack recently around inclusivity, as you probably know. I think at least South Africa has a really, really strong base from which to tackle those challenges.

[05:52] The second signal that we seem to be getting culture right is the fact that two out of three developers feel that they have significant growth opportunities in their current workplace. As developers, we constantly need to be learning new skills to keep pace, and I think it’s really great that the majority of companies seem to be creating the opportunities to learn in the workplace.

[06:14] Of course, we also need to consider compensation. In the previous list, we looked at all the factors aside from compensation. But compensation is in fact the main consideration that developers have when considering their next job. So, what I originally wanted to do with this section was to compare the average salary that developers have with those in other professions in South Africa. I actually struggled to find a sort of definitive list of the top earning professions in South Africa. But I did find a list of roles that seem to come up a lot, and those were actuaries, medical professionals, lawyers, engineers, pilots – that was a surprise to me – and software developers. I want to pause here for a second and just give you guys the opportunity to see if you can see a pattern of some kind in this list.

[07:20] What stood out to me was the fact that every single one of these roles required formal qualifications of some kind to get started. Actuaries need a degree, lawyers need a degree, [engineers] need a degree, medical specialists need a degree. Pilots, while you don’t need a degree, you need a pilot’s license, which is, one, harder than most degrees and also more expensive than most degrees. Software development was the only profession that didn’t need formal qualifications to get started: It’s the only one where companies hire you based on what you can do over any kind of qualifications. I think what’s extra cool about this for me is the fact that everything you need to learn how to code is available online for free. In theory, you could arm someone with a laptop and an internet connection and they could teach themselves how to code and join one of the highest earning professions in the country.

[08:13] Now, of course it’s not as simple as doing a few YouTube tutorials and becoming a top-earning dev, but I do think it points to the fact that it’s way easier to get started than the other professions. Now, this aside, it seems like it’s really easy to get started, but what is the impact of having a degree or not having a degree on your earning potential? Let’s start off by looking at developers with a degree. What we’re looking at right now is a graph of average developer salary based on years of experience. You can see that junior developers with a degree are earning about R20 000 a month, and then the salaries go up from there. Keep in mind these are_ average_ salaries. So the actual results are all over the show – there are certain juniors that are earning significantly more and significantly less.

[08:59] But, what happens if we compare these salaries to those of developers without a degree? The results seem pretty damn crazy, right? Essentially, what the data is saying is that developers without a degree are earning essentially the same as those with a degree. So, what does that mean? Does that mean those of you who have a degree wasted your time and your money, and that any of the students should quit their studies right now? I don’t think so. The data also showed that self-taught developers typically ended up coding way, way early in their life, and there was also a strong correlation between coding early in life and earning more. So, the world still sort of makes sense. But I do think it points to the fact that software development is relatively meritocratic. In addition to having lower barriers to entry, the industry seems to reward skill – the ability to do things – rather than qualifications.

[09:55] Cool. Now, you might be thinking, “Phillip, this sounds great. This is a very positive message and I’m really glad that developers in South Africa are earning a lot of money and I’m glad that software is relatively meritocratic and that we’re getting culture right. But dude, have you seen how much developers overseas are earning?” And yes, I have. So, let’s look at that for a second. One of the questions we asked was whether you are looking abroad for work opportunities. It turns out that one in five developers in South Africa are actively looking at opportunities abroad, and they’re mainly looking at Europe, the UK and America for those opportunities. An additional three out of five said that while they’re not actively looking, they are open to opportunities abroad. The number one reason given for that was higher earning potential.

[10:46] To investigate that a bit more, I took the average developer salary in two popular European cities, London and Amsterdam, and I compared that to the average developer salary in Johannesburg. As it stands, there’s a pretty compelling reason to be looking at jobs overseas: You could be earning almost double what you’re earning in Johannesburg in those two cities. You might even be asking why would anyone stay here if you can earn that kind of money? Before we reach that conclusion, there are a couple of factors that you want to be considering. The first one I looked at was tax. When you factor in the local tax rate for each of these cities, it changes the results a little bit, but Johannesburg is still dead last, and London is looking pretty damn great right now.

[11:40] But there’s one more factor we need to consider, and that’s cost of living. So, what cost of living indexes do is compare how expensive it is to live in different cities around the world. They consider things like rent and groceries and clothing, and then essentially with that factored in, what you get is the effective spending power in a particular area. Suddenly Johannesburg becomes the number one city. So, despite earning significantly less in Johannesburg, your spending power, what you can actually do with your money, is significantly higher.

[12:12] Now, I could guess the skeptics in the room are thinking I specifically chose these two cities to make a point, or potentially I just fudged the numbers on the cost of living. But, it’s not just us that have reached this conclusion. Back in 2015, Stack Overflow reached exactly the same conclusion, and in fact, they were even more optimistic about South Africa. They found that using the Big Mac Index, which is a cost of living index that compares the price of Big Macs in different cities around the world, South African software developers had the second highest spending power in the world. So, in summary, while there are places where you technically earn more, you won’t necessarily be able to afford the same standard of living as you would in South Africa.

[13:00] So far I’ve been saying a lot of positive things about South Africa, but I don’t mean to imply that there isn’t value in going abroad. When I was 26, my brother and I actually went to Silicon Valley for a while, and I thought I’d share that experience. So, our decision to go to Silicon Valley wasn’t about getting away from anything, it was purely because we were into startups and we wanted to see what Silicon Valley was all about. After getting the passports sorted, which was a mission, we ended up moving into a place called the Inncubator in Palo Alto – and that’s Inncubator with a double N. It was run by an ex-Marine who drove a Tesla – if you’ve seen the Silicon Valley TV show, you’ll know exactly what kind of place I’m talking about. And, just like in the TV show, it was essentially one big scam.

[13:51] The place was later referred to in the media as ‘highly suspicious hostels for techies’. We ended up moving out of the Inncubator and into a cosy one bedroom apartment in the heart of Palo Alto. It was so cosy in fact that we slept on yoga mats because it wasn’t large enough for us to fit beds inside, which, to be clear, I’m actually totally okay sleeping on yoga mats, but at R60 000 a month, it felt a little bit steep. Apart from the rent though, Silicon Valley was actually pretty damn great. The people are extremely, extremely friendly, and I would recommend anyone who is interested in startups to at least spend a few weeks there.

[14:41] The most valuable part of the experience for me was the community there and talking to other developers and founders. The picture you’re seeing right now is of a guy called Steve Blank, and I was just sitting in a coffee shop when he sat down next to me. If you’ve ever heard of the Lean Startup, this is the guy that actually started the Lean Startup movement. Through our experience in Silicon Valley, we reached a few surprising conclusions: The first was that the developer talent in South Africa is absolutely world-class. Of course Facebook and Google talk about what great developers they have, but our local companies do too.

[15:19] We also learned that we can have a far bigger impact in South Africa than we could in Silicon Valley. In Silicon Valley, things are generally pretty damn optimised, and you can slot into that world and it’s great. But, if you want to see direct impact from the work that you do, then South Africa has a lot going for it. The last conclusion we reached, which I’m not going to go into the exact specifics now, was that it’s actually easier building a serious business in South Africa than it is in Silicon Valley.

[15:46] After thinking through all of this, we decided to come back to South Africa, and for the past four years, we have taken the learnings that we had in Silicon Valley and have used them to start OfferZen. We’ve been trying to recreate some of the best parts of the Silicon Valley culture in South Africa, and thanks to all of you, we’ve had the support from the local tech community to actually do that.

[16:13] So, back to the original question: Should I be a software developer in South Africa? Let’s recap what we looked at. In terms of culture, we’re doing pretty well – four out of five developers feel valued and respected in the workplace. In terms of earning potential, South African developers have the second highest spending power in the world. In terms of impact, I’m going to leave that up to you to decide, but from my perspective South Africa is a pretty damn great place to be a software developer. In terms of the rest of the survey, if you want to look at that in detail and reach your own conclusions, you can just go to OfferZen.com. In the footer at the bottom, you will find a link to the full survey, which you can look at. I’m also going to be around all day if you want to ask me any questions. Cool. The end.

NOTE: The questions for this presentation were not transcribed.

The questions from MERGE Johannesburg start at 17:07, and the questions from MERGE Cape Town start at 23:56.

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