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How much does it cost to hire a dev team?

A project’s budget can be a delicate subject. While a well-developed digital solution surely is a worthy investment, the cost can scale up to six figures in no time. So, how much does it cost to hire a dev team?

14 June, 2022
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A project’s budget can be a delicate subject. While a well-developed digital solution surely is a worthy investment, the cost can scale up to six figures in no time. So, how much does it cost to hire a dev team? Well, what type of team? Or maybe you want just a few developers?

Let’s go through the different software development options you can choose from based on your project and what are the established prices for hiring developers - from already formed teams to individual specialists.

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How much does it cost to hire software developers

Great talent is always sought-after. Software development is no exception, so let the numbers speak for themselves. To give you an idea, the recruitment rate for software developers for software developers is expected to grow by 22% from 2019 to 2029, the fastest rate yet for all the other professions, as reported by the US Bureau of Labor Statistics.

The recruitment rate growth
The recruitment rate growth

Better yet, Stack Overflow stated two years ago that almost 60% of developers are open to new opportunities even if they’re currently employed. However, there’s a shortage of talents in today’s IT market, even despite the immense popularity of software development professions. It takes, on average, more than a month to find and hire the right developer in the US, according to Dice.

This talent deficit is great for developers allowing them to dictate their terms, but not so much for employers. Knowing the average rates and what influences them the most, you’ll always be able to pick up when the rates are sky-high, but the price-to-value ratio is below average.

That’s what we’re here to help you with. Don’t go, though, if you’re a developer yourself. Knowing the average market prices and conditions, you’ll be able to better navigate through your job search.

Cost of hiring a dedicated dev team

If hiring in-house developers is not an option, nor is it strategic to search for freelancers, you might want to go another route. If long-term projects are more up your alley, you might want to hire a dedicated development team.

In short, given that the rates of offshore developers vary based on the country of residence, hiring a dedicated project development team will cost around $5000 to $25,000 and more per month. The number of professionals in the team, their skillsets, whether or not you will have a project manager or the marketing team, etc., will play the biggest role in that cost.

Suppose you're looking to hire a dedicated team. In that case, here at Merge, we can also assemble a well-fitting crew of software developers and designers for you using the best practices of dedicated project development. Contact us to learn more.

Consider also learning some more relevant information, starting from the pros and cons of a dedicated project team to discovering when it makes sense to hire a dedicated team in the first place.

Cost of hiring a software development company

A more widespread option is hiring a professional software development company. The cost of hiring such a company starts at $10,000 a project and can go as high as $500,000, and that’s not even the limit. Such amplitude in prices is dictated by the types of both the development companies and the digital solutions they offer.

  • Hiring smaller to medium-sized companies can cost from $82 to $137 an hour, and due to a limited number of employees, their expertise is limited to a few specific software development areas they are most experienced with.
  • Bigger companies can charge way more ($110 to $220 an hour) since they have a larger variety of specialists on board.
  • For hiring employees from enterprise-level businesses, be ready to spend a minimum of $250 an hour.

Cost of hiring freelance software developers

Hiring freelancers might be a better option for smaller projects that don’t require a whole team of professionals. Generally, a freelance developer can be either a beginner (fresh out of university, boot camps, or professional courses) or a seasoned pro with a few years of experience behind them and a knowledge of at least a few programming languages.

The former will have the average rate of $50 an hour, while the pro will charge no less than $100 to $300 an hour. On Upwork, for instance, hiring freelance software developers will cost $15–$30/hour. Web developers charge $30-120+ per hour, mobile app specialists have similar rates, while hiring freelance DevOps will cost a minimum of $60/hour.

Cost of hiring in-house software developers

To establish the cost of hiring in-house developers, you’ll have to consider various factors. First, the person’s salary. In the United States, the average annual salary for, let’s say, a senior software developer is around $117,000. In the UK, expect about $95,000 equivalent for the same position. In developing countries, you can hire for much less.

Mind that those are just the approximate wages typical for that level of seniority and those countries. In reality, based on a person’s experience and expertise, those numbers can go up or down significantly. Besides salaries, don’t forget various benefits, including insurance, paid leave, overtime pay, etc.

But salaries are just one part of the picture. To maintain in-house employees, you need to rent office space and pay for the office infrastructure, such as computers, desks, chairs, and other appliances. That’s why maintaining an in-house employee might cost you, in general, a minimum of $100,000 - $200,000 a year.

How much does it cost to hire an API developer?

Hiring an experienced professional specializing in application programming interface development will result in $10,000 to 15,000 per project - again, depending on the scope of the solution, its complexity, the level of infrastructure, etc.

An hourly salary starts at about $15-$20, and for a more complex API, expect to pay at least $50/hour. To hire an API developer on Upwork, the average rates go between $20 and $250 per hour.

How much does it cost to hire a web developer

If we were to temporarily disregard such crucial factors as the web developer’s location and technology stack, then, based on seniority, the average annual salary level is the following:

  • For entry-level specialists, it would range from $40,000 to $45,000, with the median hourly rate of around $21
  • Hiring juniors would require, in general, $68,000, with the hourly rate going up to about $30 to $35
  • Intermediate level developers could receive $80,000 to $90,000, around $40/hour
  • For seniors, the annual wage would be $100,000 to $130,000, $50-$60/hour

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How much does it cost to outsource developers?

Let’s check out a few examples of how much would it cost to hire software developers in just a few of the most popular outsourcing regions, given the differences in rates and market demand.

Hiring software developers in Ukraine

Based on the SalaryExpert’s data about software developers’ salaries around the globe, the average median salary for entry-level Ukrainian specialists (1-3 years of experience) is 450,049 UAH per year, which converts to around $16,000.

Mid-level software developers earn, on average, $22,000/year, while senior programmers (8+ years of experience) receive a salary of $28,000 - $30,000 per year.

Such wages are mostly determined by significantly lower living costs for local talents than, for instance, in the United States or the UK, while skills and experience are generally at the same level.

When outsourcing Ukrainian freelancers on Upwork, the average junior coder’s rate starts at $20 per hour, while the mid-level specialists usually charge around $45/hour. For senior software developers, it’s up to $80/hour.

Hiring software developers in Poland

For Polish software development professionals, an entry-level developer’s salary is on average 113 609 zł/year, which is around $26,500. On the other end, a senior-level software developer earns an average salary of $47,000.

Standard rates for Poland (and the rest of the Eastern European countries, including Romania, Bulgaria, Hungary, Czech Republic, and Slovakia) are approximately $25-$50 per hour for software development outsourcing. Both Ukraine and Poland are considered some of the best options on the current market if you’re looking for offshore professionals.

Hiring software developers in Western Europe

If hiring offshore in Western Europe, expect an average hourly software development rate to get around $75. The biggest offshore outsourcing countries in Western Europe are the Netherlands, the UK, Germany, France, and Sweden.

As for median wages, in the United Kingdom, for example, novice software developers receive a median salary of £42,404 (around $53,000), the mid-level ones generally get between $75,000 and $85,000, and senior programmers have an average wage of $94,000. In France, it’s $50,000, $72,000, and $90,000, respectively.

Hiring software developers in North America

The average median salary for entry-level software developers in the United States is around $77,000. Mid-level specialists earn, on average, $110,000/year, while senior developers receive a salary of at least $137,000 per year. For the same levels of seniority, Canadian coders typically receive $80,000/year, $115,000/year, and $143,000/year, respectively.

Also worth noting is that, in the US, the rates can significantly change depending on the state the programmer is located in. In California, the average salary is $56 per hour, while in Washington, it’s $58.

Want to have an efficient, business-oriented design?

View a recorded webinar with Pavel Tseluyko on how design adds value to your business.

Watch now

Bottom Line

Hiring the finest specialists or teams in the software development industry is quite tempting if you know you can afford it. Having a slightly stricter budget goes hand in hand with a necessity to search the market more vigorously. With the information above, you’ll be able to know what to expect in the “costs department” and prepare for it.

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CEO and Founder of Merge

My mission is to help startups build software, experiment with new features, and bring their product vision to life.

My mission is to help startups build software, experiment with new features, and bring their product vision to life.

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