How Much Does it Cost to Hire a Software Developer?

August 2, 2023

Every industry – from healthcare to finance to ecommerce, government to legal, food to beverage, and even academic circles, will need to digitize their operations and services. It is necessary for a company to first determine How Much Does it Cost to Hire a Software Developer to develop an app for them in order to determine what they can afford.  A range of expenses will be incurred, from hiring to training to salary payments. Hiring a developer is affected by numerous factors, including the developer’s country of origin, his or her skill level, and the type of contract.

There is no doubt that hiring software developers from other nations with more favorable exchange rates will be less expensive, however, you will have to prepare for a remote method of monitoring the work.

Table of Contents

Factors affecting the cost of hiring software developers

1. Size of the project

We can guess the cost,  through the size. Costs are generally related to the size of a project. There are generally four categories of project sizes:

  • A small project

The majority of small projects consist of small changes such as UI optimizations or bug fixes with well-defined and well-known causes. Small projects also require little customer interaction, which reduces time consumption and costs. 

  • The medium-sized project

A larger engagement than a small project, but a clearly defined scope and often a standalone solution or integration. Typically, such projects involve the use of a single data source. A small mobile application or an interface to an existing inventory system would fall under this category. Compared to smaller projects, external requirements for interacting with customers are more robust. The process may involve several design sessions, weekly check-ins, and milestone approvals.

  • A large project

In addition to their depth and complexity, these solutions are more complex. For larger projects, it may be necessary to integrate multiple systems, database components, security, and logging capabilities. Scalability and maintainability are achieved through underlying frameworks and module-based designs. Listed here are multi-platform applications that run on iOS, Android, and Web). There are very robust external requirements for customer interaction, which results in lengthy design meetings and milestone agreements. On large-scale projects, daily telephone calls and interactions with technical team members are the norm, followed by weekly progress calls with senior management.

  • An enterprise-level project

Despite their complexity, these projects require a significant amount of work. A majority of enterprise-level projects are built upon the framework that underlies them. There is a much greater emphasis on security, logging, and error handling.

 These mission-critical applications require the highest level of data integrity and security. The support systems are resilient and designed to cope with two to three simultaneous failures in the underlying infrastructure before affecting users. Despite this, support systems are not limited to this category. Uber is one example of a mobile application.

It is useful to determine the size of the project when estimating the cost of hiring software developers.

2. The features and size of the team

Costs associated with software development can be significantly affected by features. A program’s price increases with the number of commands it requires. In order for a project to be successful, more people must be involved and more time must be spent on its development.

Each feature of the software must be completed by the developer. In the absence of this, the application will not function or meet the requirements. Therefore, every command that the program needs to execute must be present and function correctly. Certain features require specific skills that are not necessarily possessed by all developers. 

Imagine that you are working on a project that requires the attention of a highly experienced developer. The hourly rates of senior developers are therefore likely to be higher than those of junior or intermediate developers.

There is a wide range of salaries and job assignments for engineers at different levels, based on the experience and knowledge they possess. Allow less skilled developers to handle simple tasks, while more experienced developers should handle more complex tasks (such as payment integration). Your company must understand the amount of work involved and how many developers it needs in order to successfully develop the desired software.

An experienced software developer should be assigned to a complex project. It is also important to consider this factor when hiring software developers.

3. Experience level

Software developers with different levels of experience command varying hourly rates. Entry-level developers typically charge between $18 to $50 per hour. More experienced developers, with 5 or more years of experience, can demand rates of $50 to $75 or more per hour. For full-time software developers, the average hourly rate ranges from $80 to $120, depending on factors like location, skills, and experience. Highly skilled senior programmers with expertise in multiple programming languages may charge up to $120 per hour. Salary also depends on a candidate’s experience in handling large-scale projects, familiarity with databases, APIs, or containers.

4. Impact of Location

It’s essential to consider location when hiring developers as costs can vary significantly. For instance, hiring developers in high-demand areas like Silicon Valley or New York City can be more expensive. On the other hand, competent developers from countries like China, India, or certain European countries may offer more cost-effective rates due to currency differences and a large talent pool. Industry or field specialization, such as mobile app development, web development, or game development, can also influence costs. Additionally, unforeseen expenses like local taxes, legal considerations, time zone differences, and language challenges should be accounted for during the hiring process.

5. The project’s scope

Whether or not you choose fixed iterations, the workforce and timelines of a software development project are likely to be fixed, but the scope is more likely to change. During the development of the software, stakeholders provided constant feedback. It is possible to reduce costs by removing unnecessary features or by adding features that increase them. Software development costs increase with the scope of the project, of course.

6. Outsourcing vs. in-house

If you are considering hiring software developers in-house, there are a number of options available to you. The first option is to hire someone internally for a permanent position, which requires you to pay them a salary and provide them with benefits. An organization with ten or more developers may find this a costly endeavor, especially if it is a small company or a startup.

Another option would be to outsource the development of your software to an external firm. By outsourcing, you are able to hire qualified candidates at low rates while still gaining access to their expertise and experience.

The advantages of in-house development include maintaining control over who works on your projects and monitoring progress more easily, but when it comes to balancing costs with quality, outsourcing developers is the better choice.

A comparison of the cost of hiring a software developer:

In-house vs. Outsourced

The cost of hiring a software developer primarily hinges on their choice and expertise. For long-term projects, hiring in-house developers is advisable, although they tend to be more expensive than outsourcing teams. In-house software development demands a substantial budget and access to significant capital. However, not all organizations can allocate extensive time and resources to building an in-house team. On the other hand, outsourcing development is favored for its cost-effectiveness and scalability, making it a popular choice for many businesses.

Revenue in the IT Outsourcing market is projected to reach US$460.10bn in 2023, maintaining a rising trend. As a matter of fact, what else can be more convincing after learning that several big giants, including Google and Slack, outsource their IT development? The following is a brief explanation of why outsourced development is preferable to in-house development.

Development in-house

  • The price is high. Recruiting an internal workforce comes with evident and unspoken costs. Approximately $80,500 is the average US compensation for an IT developer, according to Payscale. There are hidden costs associated with hiring and onboarding each employee you’ve hired, as well as expenses related to sick days, paid time off, insurance, social security, and recruitment. Additionally, even when the team is idle between projects, you must pay their fixed compensation.
  • The most challenging part of your firm’s recruitment process is finding the best employees, despite the potential for high turnover rates. The high demand for IT talent will make thwarting competitors’ and recruiters’ attempts difficult. A counteroffer from you with higher perks may even be accepted by your developer. You risk losing the talent of your team if you don’t.

The team’s skills must be upgraded. The IT sector continues to undergo transformation due to new technology, tools, and languages. You will need to make sure that your crew is aware of the changes if they affect the development of your products. Training and equipment investments may have a dramatic impact on your company’s bottom line.

Development Outsourced

  • Improved control of costs. Outsourcing is most beneficial for businesses located in countries with high labor costs. In a country where wages are much lower, you can hire an IT company with the same knowledge.
  • There is a large pool of talent. Outsourcing allows you to access a wider pool of candidates than ever before. There is no end to the options you will have when you have access to such a vast talent pool around the world. To find a suitable programmer, you don’t need to sift through hundreds of resumes.
  • There are no limitations on technology. Due to the different skill sets required for different projects, it is challenging to find people who can perform different tasks well. The solution can be developed by a few IT companies with experience in the relevant technologies.

There may also be substantial differences within a nation. Developers in Texas typically earn $45 per hour while those in California typically earn $56 per hour.

Comparatively speaking, Africa and Asia are the least expensive continents for outsourcing. Indian developers, for example, charge around $20 per hour.

Based on these rates, you would pay an Indian developer $3000/month for a full-time position. The equivalent amount of labor for a full-time software developer in Texas would be $7,000.

Carmatec: Your Effortless Solution for Hiring Software Developers

With a proven track record and a commitment to delivering exceptional results, Carmatec offers businesses a seamless solution for hiring top-tier software developers.

Unraveling Carmatec’s Expertise:

Carmatec boasts a rich history of expertise in the software development industry. With a team of seasoned professionals, they have successfully executed a wide array of projects across diverse domains. Whether it’s web development, mobile app development, enterprise software, or cutting-edge technologies like AI and blockchain, Carmatec has the experience and proficiency to cater to varied business needs.

Customized Solutions for Every Business

Recognizing that each business is unique, Carmatec offers tailored solutions to align with specific project requirements. They collaborate closely with clients to understand their goals, scope, and desired outcomes. By delving into the intricacies of the project, they ensure that their team of software developers possesses the right skill set and expertise to meet the client’s exact needs.

Access to Top Talent

Carmatec has built a talent pool of highly skilled and dedicated software developers who are passionate about their craft. They prioritize recruiting developers with diverse backgrounds and proficiency in the latest technologies, allowing them to deliver innovative solutions that push the boundaries of digital experiences.

Streamlined Hiring Process

Carmatec streamlines the hiring process, saving businesses valuable time and resources. From initial project evaluation to the final deployment, they adhere to a well-structured and efficient approach. Their robust hiring process ensures that clients can quickly onboard the right developers, keeping their projects on track and within budget.

Seamlessly Integrated Teams

Carmatec fosters seamless collaboration between their developers and clients, ensuring open communication and transparency throughout the development journey. Clients have the flexibility to engage developers on both short-term and long-term projects, benefiting from the expertise of a well-integrated team.

Dedication to Excellence

At the heart of Carmatec’s ethos is a commitment to excellence. Their developers not only possess technical prowess but also a keen eye for detail and a passion for delivering top-quality solutions. This dedication to excellence resonates in every project they undertake, cementing Carmatec’s reputation as a trusted and reliable software development partner.


When it comes to hiring software developers, Carmatec stands out as an effortless solution for businesses of all sizes. With their diverse expertise, access to top talent, and dedication to excellence, they have earned the trust of countless clients worldwide.  If you seek a trustworthy and experienced partner with a proven track record, we are here to assist you in hiring developers who will execute successful projects. Reach out to us for comprehensive support in your software development journey. From conceptualization to execution, Carmatec guides businesses on their software development journey, empowering them to embrace innovation and success in the ever-evolving digital landscape.