Socio-cultural factors to consider when hiring developers in emerging markets

How to identify suitable locations to build satellite offices or distributed engineering teams that will fuel growth for years to come

When choosing to enter a new talent market, there is a wide variety of factors that, when carefully considered both individually and collectively, can be valuable indicators as to the potential benefits of that particular market.

Leadership should analyse a new market’s talent pools to determine if there is sufficient supply of the desired talent while simultaneously gauging the financial feasibility of acquiring that talent. Further analysis of the target country’s employment laws and the degree of bureaucracy present there will also contribute to a broader understanding of the hiring landscape. Less obvious factors, like examining the level of English proficiency and styles of collaboration and communication, also provide clearer signals as to whether entering that particular talent market is a promising endeavour.

Despite their individual merits, rarely should any of these indicators be taken on a stand alone basis. This is especially true for any company looking to build a sizeable hub (100+ software engineers) with the goal of ensuring hiring success for years to come. More granular insights are needed from less obvious indicators, which, although rarely explored, can potentially have a substantial ripple effect on the success of a newly established satellite office.

When expanding into a new talent market, corners cannot be cut. What works in one market often cannot be directly applied to another without consideration for that new market’s governance and social structure.

The most often overlooked yet crucial factor in analysing a new market for office expansion is an understanding of a region’s socio-cultural norms. A society’s values and tendencies can have a massive influence on how the local workforce values work-life balance and how they approach the process of searching for new jobs and subsequently moving into a new role.

How to apply these socio-cultural considerations when hiring in Central & Eastern Europe

Central & Eastern Europe, for example, is made up of a cluster of distinct countries, languages, and histories, which shared one thing in common during the latter part of the 20th Century — they lived under either the direct or indirect influence of the Soviet Union. Decades under restrictive Communist rule left behind a cultural imprint on the peoples of the region. These embedded traits are still seen to this day, passed on through generations influenced by traditionalist local culture.

General socio-cultural traits include a generalised aversion towards risk taking, which for many in Eastern Europe could mean something as simple as trying something new. Other traits include a general skepticism of outsiders and the promises of future benefits or gains. All these factors play a significant role in everything from job switching, role filtering, and offer negotiation as well as voluntary talent attrition in the region.

As a result of socio-cultural factors, common themes emerge in regards to how technical talent navigates any hiring process, especially with international companies establishing a presence in cities across the region.

Startups are, perhaps unfairly, perceived as being overly risky, despite the possibility of them being well-funded. While stock options are a normal and well-received part of total compensation in Western markets, especially the United States, they are often discounted in CEE, with talent preferring their compensation to include more salary in their place.

Further nuances regarding compensation are also present, with salary ranges often being shrouded in secrecy as if job switching and offer negotiation were a game of poker. This can also be seen in the relatively large spread between the candidate’s ask and company’s final offer. Asking rates can be as much as 30% higher than what a candidate might ultimately accept, in part used as a mitigation strategy for the short-changing that took place during decades of Communist rule.

In addition, a general skepticism is often present as to the intent of foreign companies entering the local market, leading to questions if these foreign players are opportunistic and merely short term in their hiring plans, or calculated and permanent. For remote-first startups, the lack of a local brick-and-mortar office might be perceived as a sign of impermanence due to less barriers to exit for such companies.

Perceptions surrounding work on a contracting basis versus full time employment differ significantly when compared to parts of Western Europe and the United States. Although income taxes generally favour contractors in CEE, risk-aversion can deter some tech talent (especially women) from working through their own sole proprietorships on a freelance basis; at the same time, some top candidates will only accept contract roles and are unwilling to consider full time employment. There is, however, some positive outcomes as a result of the risk aversion common in the area - a trend of lower talent attrition relative to Western hubs, in part due to perceived ‘risks’ associated with switching jobs.

These are just some of the more nuanced social factors which foreign companies should take into consideration when conducting an analysis in preparation for the launch of satellite offices or engineering teams in Central & Eastern Europe.

Carbon is the go-to staffing specialist for Eastern European and North African technical talent. Trusted by the biggest names in technology and venture capital, Carbon’s hyperlocal expertise makes entering new talent markets for value-seeking global companies possible.

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