Tech is in danger of going offshore, as Aussie universities fail to keep up with growing sector

Last year, the federal government announced Australia will accelerate the development of critical technologies to combat China’s massive investment in the sector, with $100 million dollars to be poured into emerging tech.

 While the bigger picture approach is accurate, the structures to support it simply don’t exist.

Australian universities are failing to keep pace with advances in the information technology sector by teaching students the programming languages they need to be job-ready, and this is fuelling a growing skills shortage, stifling innovation and setting new graduates up to fail.

How can Australia become a leading innovation hub with the federal government pouring hundreds of millions of dollars into the sector, when what technology students are learning at university is more than a decade old and not being utilised in the workforce?

Even if universities switched to more relevant programming languages today, they will be obsolete in a decade. So three- and four-year degrees are giving students a foundation but not the necessary skills.

Australia needs an additional 60,000 IT workers every year as the market landscape changes and businesses move to cloud infrastructure and increased digitisation, but the education streams aren’t there to provide the talent.

Graduates sent to boot camps to get job-ready

Universities should be teaching programming languages to create web and mobile applications like they do overseas, where students in Europe and the UK finish university and can walk straight into a job and can actually do it.

Big companies like Google and Microsoft have the time to give these new graduates the two to three years of training they actually need, but most other businesses don’t. 

Startups and software companies need employees who understand the relevant programming languages from the start.

The situation is so bad some companies are sending university graduates to tech boot camps for three months to make them more job ready than their entire four-year university degree did.

There’s simply too much unnecessary emphasis on having a degree to get a job and as it stands we are stifling tech innovation and inflating the skills shortage.

Crucial turning point for tech

As for the development of critical technologies? Great ideas with no plan are nothing more than great ideas.

Businesses are struggling to find staff as job vacancies surge. The technology space is at a crucial turning point. The skills shortage in this sector could be the worst it has ever been. 

Like manufacturing in decades gone by, Australia could see the tech sector move almost entirely offshore as local salaries blow out.

In the last two years, wages for senior Australian software developers have swelled from $120,000 a year to $180,000. Compare this to salary rates for software developers in the Philippines where you can hire a senior software developer with at least seven years’ experience for a fraction of that cost — as little as $30,000 annually.

Pre-COVID, businesses in Australia could expect to pay local software developers three times the salary of someone in the Philippines, who would accept the lower rate because of the cultural differences and language barriers. But now it’s six times and businesses can no longer justify the difference.

At the same time, tech employees are being pushed into senior roles much faster in Australia. What once took seven years to reach “senior” status, can now only take three years. It’s not because they are experienced enough to justify the seniority, but rather the skills shortage is so dire that companies have no choice but to pay top dollar, elevating staff to a much more senior title than they might otherwise have earned. 

Like we saw in manufacturing, Australia won’t be able to compete and our talent pool will dwindle as South East Asia drains the sector. Our loss will be their gain.