russian software developing industry and software exports

Chapter 6.
Human Resources and the Labor Market Situation
Perm (5th place), Vladislav Isenbayev (7th place) and
the coach of the SPbGU ITMO team Andrei Stankevich
(8th place).
In the «Marathon» category of the last TopCoder
contest the winner was Andrei Lopatin, twice world
champion with the team of St. Petersburg State
University in 2000 and 2001 and now its coach. The
4th place in the «Marathon» was taken by Dmitry
Trofimov, fifth-year student of SPbGU ITMO.
In recent years the competition of Russia and China
in programming contests is becoming increasingly
tough. It is representatives of these two countries
who become champions or prize-winners. Still
Russian students have a small advantage, but recently
Chinese universities have made a big breakthrough in
educating top-level programmers.
Unfortunately, successful performance of Russians
in international programming contests creates an
illusion among Russian officials of absolute wellbeing
in the field of staff training. Actually, IT industry
representatives have lots of claims to Russian higher
education institutes that are very slow to adapt their
programs to market requirements. In many respects
these claims result from the activity of the Ministry of
Education and Science and the RF Government.
Officials either ignore or react with great delay
to proposals of industry representatives concerning
relevant changes to be introduced in the system of
professional training. Therefore, companies have to
actively cooperate with universities, spending much
money on elimination of drawbacks of the state
education system.
The increase by 40,000 of budget places in
state universities to train IT specialists since 2008
is a positive sign, but these measures should have
been taken 5 years ago. The same holds true for
preparation of “Professional Standards in the Field of
Information Technologies” developed at the initiative
of the Ministry of Information and Communications
and Association APKIT and presented in April 2008.
The progress of Chinese universities should change
the attitude of Russian officials. Chinese students have
already started serious competition with Russians in
team programming, while Chinese companies do the
same on the world market of software development
services. Certain methods to support education and
the software industry may be borrowed from the
Chinese Government.
STAFF TURNOVER
The indicator of staff turnover remains at the
low level. At year-end 2008 it made 9% (i.e. equal
to 2007). Low staff turnover rate is one of Russia’s
competitive advantages on the global market of
outsourcing services. In India, a world leader of IT
outsourcing, this indicator is much higher reaching
30% and more.
Although the average staff turnover in Russian
companies is similar to the previous year, the
measurements for different groups of companies
prove that major changes have taken place. First, it
should be noted that at year-end 2007 in companies
with a turnover less than 4 MUSD this indicator was
much higher than in larger companies (21% against
1.5-2%). Such difference showed major transfer of
human resources from small companies to large
enterprises.
Given the fact that at year-end 2008 the staff
turnover rate equaled (it even slightly increased
in major companies) mass transfer of employees
from small companies to major businesses stopped.
Last year staff turnover was mainly caused by staff
reduction rather than manpower transfer between
companies. If dismissed specialists were in demand,
as a rule they were employed to replace lower-level
employees. Hence, the rotation, which allowed to
improve the average level of qualification without
changing company staff.
Staff turnover is lower in the regions (in «Other
cities» it makes 7%) and higher in St. Petersburg
(13%) and Moscow (9%), the difference being very
insignificant.
There is no marked interdependence between
staff turnover and export share in total revenue.
However, companies working mainly on the Russian
market more often said they feel a negative influence
of the crisis, their staff turnover rate is the same as in
companies earning the larger part of their revenues in
external markets.
12%
10%
8%
6%
4%
2%
0%
SALARIES
Annual index of staff turnover by size of companies
7%
up to 0.5 MUSD
6%
from 0.5 MUSD
to 4 MUSD
11%
from 4 MUSD
to 20 MUSD
10%
over 20 MUSD
The average salary of key specialists working for
Russian export software companies has decreased
for the first time in many years. In all previous years
RUSSOFT Association’s survey showed not merely
its growth but rather a rapid increase – by 30-50%
annually in dollar equivalent. Only in 2007–2008
(before the crisis) the growth was reduced, and the
average salary in dollars increased mainly owing to
the Russian ruble strengthening during that period.
According to recruitment agencies, the salary of
software developers earned in rubles was steadily
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