The tech talent war continues to intensify in Singapore as companies compete with each other with jaw-dropping salary offers, said a report done by tech talent platform NodeFlair and venture capital firm Quest Ventures.

In the last twelve months, the average salaries for software engineers reached an all-time high after increasing by up to 32 percent, according to the Tech Talent Compensation report that uncovers the tech talent salary black box and empowers tech talents and employers by analysing more than 30,000 data points from NodeFlair’s proprietary database, and in-depth
interviews with founders and engineering leaders.

According to the report, the median base salary compensation for a junior software engineer is S$4,750 ($3,537); mid-level and senior software engineers increases to S$6,500 ($4,840) and S$7,500 ($5,585) respectively; and at a lead level, it reaches S$9,000 ($6,702).

Meanwhile, at the 90th percentile, the median base salary can be as much as 3 times more than those in the 10th percentile. For instance, junior software engineers at the 90th percentile have gone up to S$7,500 ($5,585). Mid-level and senior software engineers can command S$9,500 ($7,074) and S$11,500 ($8,563) respectively; lead software engineers can command an eye-popping base salary of S$15,950 ($11,877).

“We try to stay competitive to attract tech talents, and we do it through two components: cash and equity. We understand that employees should feel valued and compensated for their skills and contributions.” said Ashish Awasthi, Chief Technology Officer of Series C startup Homage and previously held the role of Vice President at Lazada and Redmart.

Amongst the reasons why talents are looking for new opportunities, the report showed that a better salary package is the top reason (65 percent).

“Salary ranks higher than other reasons like their desire to work on new technologies, work-life balance and growth opportunities. While companies can, and will, work on the non-compensation aspect to attract talents, the easier way out in the short term will be to increase their hiring budget, especially when they are on a hiring spree,” said Ethan Ang, Chief Executive Officer and Co-Founder of NodeFlair.

The report also said that in 2021, investors poured $30 billion into blockchain and cryptocurrency because of the growth and demand for Web3 technologies, and due to the shortage of blockchain engineers, companies have adjusted their hiring strategy by hiring software engineers interested in picking up blockchain development instead, further intensifying the competition for these tech talents.

Meanwhile, the report noted that the top 15 most searched companies include the likes of homegrown tech firms like Shopee and Grab, as well as foreign tech giants Bytedance and FAANG (Facebook, Amazon, Apple and Google), have two things in common – they pay well above the market median and have above average Glassdoor ratings.

Most of these companies pay more than 12 percent above the market median; 9 of the 15 pay 25 percent above the market median, the report said.

In addition, 14 out of the 15 companies have Glassdoor ratings above the median of 3.8; and 5 of them have ratings that are at least 75th percentile of 4.2.

As the talent war over engineers intensifies, the report said companies should be prepared to face shorter average tenures and higher turnover rates amongst employees.

Talent churn in engineering functions is more than a one-off recruitment cost to replace the lost headcounts, which is much more expensive as the company has to replace those who left and onboard new members into the team, according to the report.

The report remarks that while many companies allocate most of their resources on recruiting talents, few have invested equivalent effort resources into talent development and retention.

Ang shared that at a turning point, the tangible and intangible costs of recruiting talent can be too high for a company if it does not have a strong culture in place to retain
these talents.

“Companies need to invest in leaders who can grow and retain these talents through non-compensation means, such as enforcing a higher quality engineering culture and creating a better developer experience,” he added.

Quest Ventures Managing Partner James Tan also highlighted that salary is identified as the largest push and pull factor, and the reason responsible for failed job placement.

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