Job Market Indicators in Software Development Sector: A Data-Driven Analysis of Poland and the Baltics

This study examines the dynamics of supply and demand within the software development sector in Poland and the Baltics during 2023, highlighting the underlying tension between talent availability and market needs. The concept of the "IT bench," similar to a sports team's reserves, illustrates how regional companies maintain a readily deployable pool of talent, underscoring the importance of flexibility and rapid response capabilities in today's volatile market. Using data from industry-specific sources, this research provides insights into demand fluctuations for key roles, such as Software Engineering, Tech Project Management, and Design, along with changes in median salaries in response to external economic pressures. Challenges such as wage growth and the impact of political and economic factors on business conditions are explored, providing context to the evolving dynamics of the software development job market. The methodology applies a collective dynamics framework using a 60-day rolling window to compute time-varying correlation matrices of job market indicators, including role-specific demand and salary trends. This analysis reveals significant correlations between job categories, indicating how shifts in demand for one role impact others. For example, the positive correlation between Software Engineering and Design roles reflects their interdependent nature. In contrast, the inverse correlation between Software Engineering and Sales & Business Development points to strategic shifts in hiring priorities. Key findings indicate that the software development industry is adapting to global tech layoffs and economic uncertainties by emphasising strategic talent management and flexible, project-based teams. The demand for developers in key technologies, such as Java, JavaScript, and Python, remains high, albeit with adjustments to salary expectations and employment conditions to better navigate market challenges. This research highlights the importance of a data-driven approach to recruitment and talent strategy, integrating technological tools with human insight to effectively adapt to the evolving market landscape.