Switzerland Software Development Market

Report Code: ITR 0437 Report Format: PDF + Excel

Switzerland Software Development Market Overview:

The market for Switzerland Software Development is analysed to be €5,418m in 2021 and is projected to grow at a CAGR of 10.98% during forecast period 2022-2027. Switzerland is on track to overtake the United States as Europe's top technology nation, according to the State of European Tech 2019 study. 

Zurich, a vibrant and diverse melting pot, is thought to be the most alluring city in Switzerland for developers. The Maastricht School of Management (MSM) predicts that starting in 2017, Swiss businesses would increase their ICT spending. Digitalization and the Internet of Things are directly responsible for this rise. According to MSM Research, spending on digitization will play a significant role in generating growth.

 This spending will consequently rise by 35% starting in 2017. The survey estimates that there are 210,800 professionals working in ICT (which covers the IT and telecommunications businesses), a rise of 13,000 from 2013. The group emphasises that although Switzerland's economy is expanding twice as quickly as its workforce in information technology, more experts are still needed in this field. According to Swiss media, Switzerland will have a shortage of 25,000 ICT employees by 2024. 

Software development currently has a 48 percent unemployment rate in the IT sector. In addition, Swiss firms continue to favour private cloud services despite the fact that public and hybrid cloud models allow them to remain flexible and effective. Only 28% of Swiss organisations use hybrid clouds, and more than half have no immediate plans to do so, according to the most recent IDC statistics. The security rule, which only permits organisations like banks and health care providers to keep data in Switzerland, could be part of the rationale.

Report Coverage

The report: “Switzerland Software Development Market – Forecast (2022-2027)”, by IndustryARC covers an in-depth analysis of the following segments in the Switzerland Software Development market. 

By Language: SQL, Python, Java, ABAP, R, Scala, C/C++/C#, Ruby, IOS, Android, Perl, LISA and others.
By Market Demand: In-House on Payroll, Hired from Secondment Providers, Hired Freelancers and Fully Outsourced.
By Deployment Type: On-Premise and Cloud.
By Business Size: Small and Medium Business, Enterprises and Government.
By End-use Industry: Banking and Financial Institution, Insurance Firms, Media and Entertainment, Government, Defense, Telecommunication, Automotive, Consumer Goods and Retail, Healthcare, Manufacturing, Energy & Utilities, Travel & Logistics, Fintech, eCommerce and others.

Key Takeaways

  • The SQL segment is analysed to hold highest share in 2021 owing to the rising usage of it by database developers. 
  • The in-house on payroll segment accounts for the dominant market share during the forecast period owing to the majority of employers working on in-house payroll scheme. In Switzerland, around 47% of software employees are employed in-house.
  • Recently, the markets are witnessing a growing number of investments for the start-up, which is set to drive the growth of the underlying market.

Switzerland Software Development Market Segmentation Analysis – By Language
In terms of language, the SQL segment is analysed to hold highest share in 2021 owing to the rising usage of it by database developers. As a part of this, PostgreSQL maintained its popularity, gaining about 10% of the total number of mentions and being frequently utilised by database developers. 

MySQL and its well-known community fork MariaDB both gained ground. Simultaneously, databases for specific use cases, such as Elasticsearch for search and SQLite for directly embedding SQL into an application, are gaining popularity. At some point, Microsoft SQL will also be "open sourced" in some way. 

Moreover, the average SQL developer pay in Switzerland is CHF 115,000 per year, or CHF 58.97 per hour, according to talent.com. The starting salary for entry-level positions is CHF 114,000 per year, with most experienced workers earning up to CHF 147,188 per year. However, the python segment is also analysed to grow at a higher rate owing the presence of major organization hiring python developers. For instance, Akselos, Connect44, Edge Laboratories, Caplena, Darwin Recruitment, Swissquote, 4teamwork, Mathrix, wega Informatik, and Pulilab are among the top organisations that hire Python Developers. Python developers are in high demand in cities such as Zürich, Genf, Zug, Lausanne, Bern, Basel, Carouge, Stäfa, Lugano, and Chiasso. 

Switzerland Software Development Market Segmentation Analysis - By Market Demand
The in-house on payroll segment accounts for the dominant market share during the forecast period owing to the majority of employers working on in-house payroll scheme. In Switzerland, around 47% of software employees are employed in-house. In addition, skilled workers are in limited supply. 

According to the Adecco Group's Swiss Skills Shortage Index, the demand for skilled labour in the summer half-year of 2021 was up 27% over the previous year. Meanwhile, the number of job openings in Switzerland increased in practically all occupations. However, the fully outsourced segment is also analysed to grow at a higher rate owing to the growing trend in the country regarding IT outsourcing. 

According to the Swiss IT Outsourcing Study, 80% of all respondent’s state that they will continue to outsource at the same level or higher in the next years, and 43% say they will outsource more. The majority of Swiss companies, as well as enterprises from other DACH nations, cite a lack of resources and a desire to save money as the primary reasons for outsourcing their IT services to professionals in other countries. According to the KPMG report, access to highly skilled specialists is vital to nearly a third of respondents, and 20% of them want to increase quality. 

According to Swiss online edition inside-it.ch, IT outsourcing is notably popular in the Swiss banking industry, with three out of four banks outsourcing their IT. In most cases, Swiss companies outsource large IT projects to Asia, particularly India. Nearshoring, also known as outsourcing, has become increasingly popular among Swiss companies in recent years, particularly in Eastern European nations such as Poland and Romania, as well as Balkan countries such as Serbia and Bulgaria.

 Switzerland Software Development Market Drivers

Vibrant start-up sector
Recently, the markets are witnessing a growing number of investments for the start-up, which is set to drive the growth of the underlying market. For instance, Switzerland received $445 million in investments in 2019. The rapid expansion of the Swiss start-up ecosystem is a unique phenomenon that is no longer an exception. Exits that are well-executed allow investors to keep investing and allocating cash that will ensure significant growth. In terms of exits, Switzerland is on the upswing. Around 50 software companies closed their doors between 2015 and 2017. Because they operate in a variety of industries, Swiss start-ups are comparable to traditional industry landscapes. According to Swiss Start-up Radar 2019/2020, the biotech business stands out when comparing the technology sector in Switzerland, accounting for half of all exits in which companies were valued at more than CHF 100 million. Switzerland is made up of cantons, which have a significant degree of autonomy, which has an impact on the distribution and specialisation of start-up ecosystems. Zurich's position as a tech centre and the city with the greatest start-up scene is closely followed by cities like Zug and Geneva.

Leader in Innovation
Switzerland is ranked top in the World Intellectual Property Organization's assessment of innovative development. The country has now placed in the top five for the sixth time. Sweden is in second position this year. Due to their level of scientific knowledge and capacity to turn technologies into marketable consumables, Switzerland is a global leader. In terms of the number of patents for inventions per capita, Switzerland holds a significant lead. In the year 2015, there were 873 patent licence applications per million people in Switzerland. On a regular basis, Swiss universities look to be among the best in the world. For example, in the Times Higher Education World Reputation Ranking assessment of 2016, Lake Of Zurich High Technical School was ranked fourth, only after Oxford, Cambridge, and Imperial College London. Because there is constant collaboration between educational institutions, universities, and the private sector, Switzerland also offers the possibility to build research and development, innovation centres, and techno parks around the country. Roche and Novartis, two of Switzerland's largest pharmaceutical companies, are among the country's largest research and development institutes, with substantial R&D budgets. Roche and Novartis appear to be the leading drivers of innovation development in Switzerland and around the world, maintaining and developing close contact ties between business, authorities, venture capital, small and medium-sized businesses, innovative start-ups, universities, and R&D establishments.

Switzerland Software Development Market Challenges 

Language Barriers for Swiss Workers
According to the latest edition of the Swiss HR Barometer, published by the Federal Institute of Technology (ETH) Zurich and the Universities of Lucerne and Zurich, language barriers are one of the top causes for lack of integration. According to SWI, foreign workers integrate swiftly and successfully into the Swiss labour market, earning on average more than Swiss workers after five years. Zurich is the world's largest technological centre, with over 100,000 registered software developers (followed by Vaud and Zug), as well as the world's largest international community. Apart from Germans (19,309) and Italians (14,241), the other major national groupings in Zurich are Serbia and Montenegro (13,169), Portugal (7,553), Spain (5,360), and Turkey (5,047), according to the Swiss Federal Statistics Office. Factors like these are some of the major challenges that are restraining the growth of the underlying market. 
 Switzerland Software Development Market Competitive Landscape
Product launches, acquisitions, market penetration and R&D activities are key strategies adopted by players in the Switzerland Software Development market. The top 10 Switzerland Software Development market companies are
  • Axisbits
  • Astarios
  • Blueworks
  • Pycogroup
  • Glaux Soft AG
  • Modeso
  • Zehnplus
  • Navori Labs
  • ROB Technologies
  • Eximias Gmbh

Recent Developments
  • In March 2022, The Open Telekom Cloud platform has been expanded by T-Systems, a division of German MNO Deutsche Telekom, into Switzerland by building additional data centres there.
  • In November 2021, by utilising the cloud, Tata Consultancy Services has expanded its 18-year cooperation with Swiss Re in order to assist the Zurich-based reinsurance company in creating a more social and open digital workspace that would foster greater innovation and collaboration.
  • In November 2020, to assist the various local businesses and public sector organisations that use its platform, Amazon Web Services announced its expansion intentions to construct a cloud region, or data centre cluster, in Switzerland.

1. Switzerland Software Development Market Overview
    1.1. Definitions and Scope
2. Switzerland Software Development Market - Executive Summary
    2.1 Market Revenue and Key Trends by Company
    2.2 Key trends by Language
    2.3 Key trends by Market Demand
    2.4 Key trends by Deployment Type
    2.5 Key trends by Business Size
    2.6 Key trends by End-Use Industry
    2.7 Key trends by Country
3. Switzerland Software Development Market Forces
    3.1 Market Drivers
        3.1.1 Vibrant start-up sector
        3.1.2 Leader in Innovation
    3.2 Market Constraints
        3.2.1 Language Barriers for Swiss Workers
4. Switzerland Software Development Market -Strategic analysis
    4.1 Value chain analysis 
    4.2 Opportunities analysis
        4.2.1 Switzerland tech hubs creating opportunities
    4.3 Freelance and Secondment Impact Analysis
        4.3.1 Labor Legislation
        4.3.2 Economic Developments
        4.3.3 Schooling/Education
        4.3.4 Corporate Recruitment Plans
5. Switzerland Software Development Market – By Language (Market Size – €Million/€Billion)
    5.1. SQL
    5.2. Python
    5.3. Java
    5.4. ABAP
    5.5. R
    5.6. Scala
    5.7. C/C++/C##
    5.8. Ruby
    5.9. IOS
    5.10. Android
    5.11. Perl
    5.12. LISA
    5.13. Others
6. Switzerland Software Development Market – By Market Demand (Market Size –€Million/€Billion)
    6.1 In-House on Payroll
    6.2 Hired from Secondment Providers
    6.3 Hired Freelancers
    6.4 Fully Outsourced
7. Switzerland Software Development Market – By Deployment Type (Market Size –€Million/€Billion)
    7.1 On-Premise
    7.2 Cloud
8. Switzerland Software Development Market – By Business Size (Market Size –€Million/€Billion)
    8.1 Small and Medium Business
    8.2 Enterprise
    8.3 Government
9. Switzerland Software Development Market - By End-use Industry (Market Size -€Million/€Billion)
    9.1. Banking and Financial Institution
    9.2. Insurance Firms
    9.3. Media and Entertainment
    9.4. Government
    9.5. Defense
    9.6. Telecommunication
    9.7. Automotive
    9.8. Consumer Goods and retail
    9.9. Healthcare
    9.10. Manufacturing
    9.11. Energy & Utilities
    9.12. Travel & Logistics
    9.13. Fintech
    9.14. eCommerce
    9.15. Others
10. Switzerland Software Development Market Company Analysis
    10.1. Company Revenue, Products, M&A, Developments
    10.2. Axisbits
    10.3. Astarios
    10.4. Blueworks
    10.5. Pycogroup
    10.6. Glaux Soft AG
    10.7. Modeso
    10.8. Zehnplus
    10.9. Navori Labs
    10.1. 0ROB Technologies
    10.1. 1Eximias Gmbh

*"Financials would be provided to private companies on a best-effort basis."