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Home Services Global Team Augmentation Blog Trends Talent Shortage in the Nordics: How Norway, Sweden, Finland, and Denmark Can Solve the Software Developer Shortage in 2021

Talent Shortage in the Nordics: How Norway, Sweden, Finland, and Denmark Can Solve the Software Developer Shortage in 2021

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The global talent shortage has almost doubled compared to what it was a decade ago. 54% of companies worldwide report talent shortages, and the Nordics are no exception.

Ranking high among the best countries for business, the Nordic countries, including Sweden, Norway, Denmark, and Finland, have seen a significant inflow of venture capital recently. With more investments fueling market growth, the software developer shortage has gone into hyperspeed. Find out how Nordic companies can overcome the IT talent shortage challenge.

Talent Shortage in the Nordics. Is Your Country at Risk?

Talent shortage in the Nordics

Talent shortage in the Nordics Source

Norway IT Skills Shortage List 

  • Product innovation
  • Digitization
  • Robotics
  • Network security

Norway has a thriving economy and a low unemployment rate. With at least 80,000 people working in the IT industry, the gap between supply and demand for IT skills is currently continuing to rise in Norway. Almost 30% of companies cite a shortage of IT expertise as the principal obstacle to growth. 

Fast-growing software development companies in Norway are struggling to recruit technical personnel in sufficient numbers to support expansion. Skills in demand include product innovation, digitisation, robotics, and network security. In IT security alone, Norway could face a shortfall of more than 4,000 experts by 2030.

The Norwegian language is not a must-have in the global IT industry, and in the battle between language skills and programming skills, programming comes out on top nearly every time. Therefore, software development companies in Norway solve their tech talent shortage problem by taking advantage of software outsourcing. 

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Sweden IT Skills Shortage List

  • Process engineers
  • Project leaders
  • Laboratory engineers
  • IT developers (Java, embedded)
  • Testers/test leaders

According to the Hays Global Skills Index 2019/20, Sweden is amongst the most pressured labour markets. The talent shortage indicator has risen to the highest possible score of 10.0, which shows that the gap between the skills wanted by businesses and the skills available on the labour market is now at its greatest.

Sweden is known as one of the world's most innovative nations, having Skype and Spotify under its belt to name just a few.  A large presence of start-ups, research and development institutions, numerous technology parks, and international software development companies in Sweden has contributed to a very high demand for qualified IT professionals throughout Sweden.

It is expected that 70,000 unfilled digital roles will hit Sweden by 2022, accounting for 4% of the European digital skills shortage.

The main reasons for the software developer shortage in Sweden are:

  • inability of the education system to adapt to the current market needs
  • difficulties matching available skills with existing jobs
  • growing wage pressure

Finland IT Skills Shortage List

  • Telecommunication engineers
  • System analysts
  • Software developers
  • Web and multimedia developers

The talent shortage in Finland is a side effect of the country’s technology rise: the IT industry has now become Finland’s biggest sector and it is regarded as a major European tech hub. The country is the 9th best country for startups in Europe. 

66% of open positions in tech seek software development professionals, so the software engineer shortage is the most important challenge in the country.

A survey by the Technology Industries of Finland, which questioned 350 companies representing around a third of all businesses in this sector, found that 53,000 workers are needed in the tech industry in 2021.

Similarly to Sweden, Finland’s IT talent shortage can be blamed on the inability of the education system to prepare the required number of professionals. Out of 1,100 information and communication technology students graduating Finnish schools every year, less than 300 specialize in software development.

Furthermore, over 30% of polytechnic students in Finland are foreigners, and only about a half of them usually choose to stay in the country after graduation.

Although Finnish companies receive, on average, significantly fewer applications than the European average, the employers are still more reluctant to hire developers outside the country.

Denmark Skills Shortage List

  • Software developers
  • Marketing specialists – digital/communications
  • Mechanical engineers
  • Regulatory affairs managers
  • Quality assurance managers

Despite a low rate of unemployment and an economy that continues to improve, Denmark is facing a serious talent shortage, according to the Hays Skill Index research mentioned above. As a result, Denmark is expected to come short of 19,000 IT professionals by 2030.

The situation might get even worse as the number of the global tech giants, including IBM, Microsoft, and Uber, are either setting up or expanding their R&D facilities in the country.

The latest technology developments enabled Danish companies to attract people from outside of the country, which is the only way out to fight the local developer shortage.

Solving the Talent Shortage: 3 Ways Nordic Businesses Can Close the Skill Gap

Solving the talent shortage problem cannot be done overnight. Skill shortage can put the very existence of your business at risk, not to mention the inability to scale your company without the required number of skilled software developers.

1. Grow expertise on-site

In the face of the growing talent shortage, Nordic businesses are trying to find a way to hire and retain the right talent. One of the ways to fight the skill shortage is to grow the necessary expertise on site.

Waiting for the government to introduce the required changes to the education system might be a real waste of time. That is why Nordic companies are already introducing their own training programs to close the IT talent shortage gap. There are even some projects aimed at teaching refugees to code and eventually become software developers.

Integrify, for example, claims to “create 10,000+ developer jobs by 2030.” The company is on a mission to turn refugees, asylum seekers, and immigrants into skilled workforce while helping tech companies and startups fill the vacancies.

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However, this approach can be viable only in the long-term outlook: it takes several months to teach a person the basics of software development. Moreover, this method will only allow to fill junior or trainee level positions.

2. Relocate skilled specialists from abroad

Another solution to solving the talent shortage problem is to relocate skilled specialists from abroad.

By sourcing skilled software developers abroad, you get access to an unlimited skills pool. However, this method requires certain investments as well as time, especially taking into account the bureaucracy and certain restrictions in migration policies of different countries. That is why this approach is mostly preferred by large or enterprise-level companies with long-term growth outlook.

3. Hire skilled software developers remotely

Yet another viable option Norway, Sweden, Finland, and Denmark choose to solve the talent shortage problem is to hire skilled software developers remotely. In this case, most businesses choose to partner with professional staffing agencies.

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Grid Dynamics is a digital-native technology services provider that accelerates growth and bolsters competitive advantage for Fortune 1000 companies. The company has 15+ years of experience in digital transformation and software innovation, most notably open source cloud-native programs.  

Our clients have the option of choosing the engagement model which best suits their requirements, including team extension, dedicated teams, pod teams, and remote development centers. Grid Dynamics has offices throughout Eastern Europe and Central Europe and Latin America, meaning that we have the resources to cater to the needs of companies of any size, no matter where they are located.

Our model has already helped dozens of startups and companies grow despite the global skill shortage.

This is why over 85 companies have chosen to hire remote developers with Grid Dynamics:

  • Top tech talent. We thoroughly pre-screen developers based on the client’s requirements. The client personally interviews and approves the best candidates.
  • Direct communication. The client personally manages remote developers using preferred methods and tools.
  • Commitment. Each remote developer works exclusively for one client and is fully dedicated to the project.
  • Dedicated contact person. You work with a dedicated HR/Client Manager who helps you build effective working relationships with your developers. They are always there in case of questions and emergencies.
  • No back-office hassle. With Time & Material, we handle payroll, taxes, workstations, office management, HR, and retention.
  • No upfront payment. You don’t have to pay us anything until you decide to hire software developers with us.
  • Flexibility. You can increase or decrease the size of your offshore team with only one month’s prior notice.

To find out how Grid Dynamics can help you extend your team with remote software developers, fill out the form below. We will get back to you as soon as possible.

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Grid Dynamics Writers Team is a team of passionate creative writers, content marketers, designers who vigorously research internet as well as cooperate with developers and our recruitment team to provide you with top-notch material about tech, salary trends, development team hiring and management tips as well as up-to-date information about IT tech talent market around the world.

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