Russoft: staff turnover in software development has stabilized at around 12%

The average turnover rate of Russian software companies by the end of 2023 was 11.6%. It has remained at this level for the past five years, although relative to the 2022 level, we can talk about a slight fluctuation up and down in different years. This was reported to CNews by representatives of Russoft.

Up until 2015, the share of specialized employees who left software companies during the year fluctuated mainly in the range of 6-7%, but in 2016 the figure increased to 9.5% and stabilized at this level in the following two years. In 2019, there was a new jump – to 12.5%, and since then the staff turnover has not fallen below 11.3%, but has not exceeded 13.3%.

In 2023, due to the start of real import substitution of software, competition for personnel within Russia intensified. However, no clear increase in the staff turnover rate was recorded. If we look at the average indicator for the surveyed companies, it increased from 11.3% in 2022 to 15.9% in 2023. When selecting 144 companies that participated in both the 2023 and 2024 surveys (therefore, a change in the composition of the surveyed companies could not affect the result), an increase in staff turnover was obtained from 14.5% to 16.9%. The share of companies that experienced personnel losses also increased.

“As a rule, companies try to solve the problem of high staff turnover in a comprehensive manner. Here, tools are used to retain employees: such as developing an internal culture and improving working conditions. Working on processes, bringing them to maximum universality, for example, prescribed documentation or general laws for writing code, also helps. Such unpopular measures as a ban on working from abroad or mandatory work in the office are often a key factor for people in deciding to change jobs,” she said. Ksenia KoskovaHR Director of the digital platform for organizing business trips and managing expenses “Raketa”.

However, extrapolating the survey results to the entire industry shows that turnover has remained virtually unchanged over the year, rising from 11.3% to 11.6%.

At the same time, the 2023 survey and the 2022 results could not take into account data from companies that ceased their operations in Russia in 2022 due to the risk of falling under primary or secondary sanctions. At the time of the survey in the spring of 2023, they no longer had staff (or they did not participate in the survey).

The turnover rate obtained in the 2023 survey based on the results of 2022 is average only for those companies that remained in Russia. If we take into account layoffs at all software companies, which include development centers of foreign corporations closed in the last two years, then another 5-7 percentage points should be added to the calculated turnover rate. Consequently, taking this factor into account, in 2023 we can state not an increase, but a significant decrease in the turnover rate. Thus, for companies that continue to operate in Russia, the turnover rate remains stable with some signs of growth, and for the entire industry, a significant decrease was recorded based on the results of 2023.

“Employee turnover rates have been stable in recent years. This may indicate that most IT companies have reached maturity in the field of HR management, that is, the maturity of the Russian IT industry as a whole. At the same time, it is worth noting the emerging trend of increasing turnover in 2024, which clearly indicates an overheated labor market, an increasing trend in the growth of import substitution projects and a shortage of professionals to implement these plans. Companies must pay attention to the development of soft skill practices for middle and senior management in the field of work and HR management. First of all, for the middle management, since this is the majority of managers who directly work and interact with employees on a daily basis. It is also necessary to carefully approach the selection of a candidate for the position of HR director in many companies (primarily small ones). Many companies still believe that the HR director is the head of the HR department, and one employee can successfully combine several roles,” said Mikhail Krasnov, Managing Director of WMT Group.

Unlike previous years, when there was a flow of personnel from small to large companies, by the end of 2023, large companies had more personnel losses. With a turnover of less than 1.5 billion rubles, staff turnover does not exceed 10%.

“According to the SME Corporation, over 96% of companies in Russia are SMBs, 75% of which are developing IT companies with ample opportunities to attract investment. The atmosphere of a “startup” is strikingly different from an enterprise: a hybrid or remote schedule, including for relocators, benefits, the opportunity to continue freelancing. Since there are more such companies, their overall turnover rate is lower. Large businesses imply strict corporate rules: mainly an office, clear boundaries of the working day, reporting and dependence on stakeholders, whose decisions are not always transparent. To reduce turnover, companies can add flexibility, internal CustDevs to identify personal needs, and also work out the issue of opening targeted programs in universities to retain graduates for the next three years,” she said. Leona DruzhininaSMO “Stakhanovets”.