Eventual economic recessions and depressions are inevitable occurrences of modern life. As a software developer, you can sometimes avoid or at least lessen the potential cataclysm of economic fallout. Your profession can command above average stability and flexibility in comparison to many other types of jobs. But ultimately your job is only as assured as the overall industry in which it is placed. Whether you’re a STEM student, a student about to graduate, or someone wanting to switch careers, it’s important to pick the right starting industry for guaranteed stability through rough economic times.
Many outsiders that are just starting the process of breaking into a new software career often think events like the dot-com bubble and other high profile tech firm failures affect all industries equally. But evidence shows some industries are immune or not as severely impacted as others depending on the type of economic event. While it’s impossible to predict all major economic failures, placing yourself in these more stable industries can lessen the overall negative impact on your life. Much like diversifying your investment portfolio, so too can your job be perfect for the risk-averse individual.
Much of what follows in this article is a brief look at and commentary on projection statistics from resources like the Bureau of Labor Statistics (BLS). Note that these are models that cannot 100% predict the future. We’ll also discuss the general resilience of these industries in times of economic downturns.
Always remember that while the advice we provide here is based on best cased scenarios, there still exists the real possibility of major catastrophes that could throw plans into disarray. For example, as of this writing, COVID-19 has caught the entire world off guard in a matter of months.
Section 8, Article I of the U.S. Consitution states (among other things):
To raise and support armies, but no appropriation of money to that use shall be for a longer term than two years;— Section 8, Article I, U.S. Constitution
To provide and maintain a navy;
To make rules for the government and regulation of the land and naval forces;
Literally baked directly into the U.S. Consitution is a mandate to protect the nation by appropriating money for the purposes of maintaining an army and a navy.
What does that mean for you as a software developer? A few things.
First, there’s always a need for defense. With that need comes a constant supply of money and people power being poured into the various defense industries across the nation. Second, nations are constantly racing with each other to be the first and best in new technologies. Yes, most of those technologies will be focused on combat capabilities, but many of them end up improving daily lives more than most people know. For example, the Internet and GPS were funded and invented through programs in the U.S. Department of Defense primarily for military purposes. Now look where we are.
You’ll have no shortage of massive companies to choose from as well. Consider the following top ten defense contractors as of 2019:
- Lockheed Martin – $44.9 billion sales
- Boeing – $26.9 billion sales
- Raytheon – $23.9 billion sales
- BAE Systems – $22.9 billion sales
- Northrop Grumman – $22.4 billion sales
- General Dynamics – $19.5 billion sales
- Airbus Group – $11.3 billion sales
- Thales – $9 billion sales
- Leonardo – $8.9 billion sales
- Almaz-Antey – $8.6 billion sales
As should be obvious by now, there’s a lot of money in defense and a lot of companies competing for that money.
The defense industries are generally resilient to economic recessions and depressions for several reasons: 1) the demand for defense doesn’t go away during bad economic times, 2) big money contracts often last years and aren’t immediately cancelled by a bad economy, and 3) a vast majority of the military contracts are backed by the full faith and support of the U.S. Treasury.
According to the BLS, “Health care and social assistance” industries are projected to grow in employment from 2018 to 2028 by approximately 3,396,100 jobs. Wow, that’s a lot of jobs. We have to admit that even we were surprised by that number.
But it makes sense when you consider the shifting ages and demographics of the nation as a whole as we approach 2030.
The number of Americans ages 65 and older is projected to nearly double from 52 million in 2018 to 95 million by 2060, and the 65-and-older age group’s share of the total population will rise from 16 percent to 23 percent.— PRB Fact Sheet and U.S. Census Bureau
As the nation’s technology and health improves, so too do the ages of the population. People continue to live longer, babies continue to survive births more often, and the overall ages of the population continue to increase.
But with those increases in age come increases in health risks that are sometimes unavoidable and inevitable consequences of getting old. That means a constant need for doctors, nurses, hospital workers, ambulance drivers, paramedics, and a host of other businesses that assist in the design, delivery, and implementation of health care. Those employees need tools to do their jobs, and the majority of those tools are increasingly digital.
Think about all the advanced devices in use today to provide treatment to an individual. A highly simplified flow of how these devices came to be in use might be:
- Product managers and health experts dream up new devices
- Accountants estimate cost projections
- Software and mechanical engineers design and create the devices
- Sales and marketing pitch the devices to hospitals and offices
- Devices are shipped as appropriate
- Hospitals and offices begin using devices
Obviously such a flow is overly simplified, but there’s a few points to be made here. Notice how many types of workers are crossed in support of a health device? Product owners, project managers, accountants engineers, salespeople, marketers, transportation, logistics, and technicians are the obvious ones, but there’s probably a lot more. At every level is an opportunity for a software developer to be thoroughly involved. All of these employee types use software technologies to do their job.
Even if you aren’t directly working for a healthcare company, the chances are likely that you’ll be creating software that supports the massive and in-demand industry for a long time to come. That’s a lot of opportunity that doesn’t show any signs of slowing as the world continues to become healthier and older.
According to the BLS, “Education services” and “Other educational services” industries are projected to grow in employment from 2018 to 2028 by approximately 588,300 jobs.
The U.S. is often a dream destination for many students wanting to attend the most prestigious academic institutions. Universities continue to be filled with students domestic and international even as tuition rates continue to rise. The trend is expected to continue until at least 2029.
If it isn’t obvious by that description, we’ll lay it out for you in plain language. There’s a never ending supply of students coming to the U.S. for good undergraduate and post-graduate educations. Students bring demands for all kinds of technology for both their educational and recreational purposes.
It’s not just an increasing population of students, either. The demand for technology increases as students become more tech-savvy, tools improve in use and accuracy, and STEM professions become more demanding of their outcomes. With many universities offering more virtual classes for students and the need to have valuable online classes during conditions that are most recently obvious (COVID-19 outbreak), there is an abundance of opportunity to be a part of the teams that design and build technologies that directly enables these activities.
What about recessions and depressions though? Is the education industry immune? No industry is immune, and it’s impossible to know the specifics of every future economic problem, but there is resiliency in the education industry. When times are tough and money is tight, people tend to prioritize education and health over discretionary purchases. Sometimes other family members will pitch in to help or students will have saved up money to continue their education through financial droughts.
A growing population of buyers (students) and a constant demand for technological improvements in education delivery and consumption is good news for budding software developers that want a secure and resilient future.
According to the BLS, “Transportation and warehousing” industries are projected to grow in employment from 2018 to 2028 by approximately 322,300 jobs.
It might seem strange to think of transportation at the same time as technology and the software developers that power it. But there are a lot of support systems behind the veil that aren’t immediately obvious to people. These systems are under increasing stress as consumer activity picks up, the world becomes more globally connected, and less prosperous nations move up the ranks of prosperity.
Logistics. There’s a lot of trucks on the road, planes in the air, and a lot of deliveries to make. Without software to properly schedule trucks and planes to their destinations and predict logistical challenges, transportation companies would be “flying blind.” Software engineers are in demand to improve the tools used by transportation companies to make sure deliveries are made on time in the most efficient manner. Remember that these tools can also be used by consumers as seen by online package tracking services from UPS, FedEx, and USPS.
Weather. Deliveries made by truck or plane are subject to the whims of mother nature. This is especially true for planes that can sometimes be held back from taking flight if the weather conditions aren’t right. The algorithms and models used to predict what types of weather events will occur throughout the day are baked directly into complex software systems. Unfortunately these applications can be ancient (30+ years), so don’t expect to find any glory in getting involved with them. Instead, treat them as incredibly stable job security positions.
Communication. The above two categories aren’t very useful if the data can’t be communicated to those who need it. Even transportation companies have telephone, network, and web server infrastructure that needs to be set up and maintained. Sometimes this work can be contracted out to third parties, but the fact remains that the demand is very real.
There’s also the elephant in the room: self-driving trucks and taxi disrupting companies like Uber/Lyft. While self-driving vehicles are certainly far away from being road ready and approved by various departments of transportation, the amount of money being poured into the research and development of such technologies is increasing. The overall goal being to reduce expenses paid to employees (salaries) by these companies and to hopefully create a safer, more efficient driving workforce through automation. This research is likely to continue even in the worst of times.
All the above is usually not affected by economic problems as severely as other industries. While recessions usually result in reduced consumer activity and reduced transportation traffic, there remains adequate demand for non-consumer related transportation activities. Larger scale global transportation strategies across continents often schedule their activities months (and sometimes years) in advance which would continue even if the economy explodes.
Banking & Finance
According to the BLS, “Finance and insurance” industries are projected to grow in employment from 2018 to 2028 by approximately 168,400 jobs.
We like to think of the banking, finance, and insurance industries as the titans and pinnacles of stability. The 2008 housing and banking crisis taught everyone a useful reminder that not every industry is safe from economic headwinds. But it also showed us that big governments are willing to step in to save them when the bigger players are close to spectacular failure.
In addition to business stability (even if it does require the occasional rescue and bailout), financial companies heavily rely on rock-solid infrastructure and software. You can see why when you think about it.
Banks. Customers trust them with their vast sums of money and expect returns in the forms of interest, dividends, or stock values. If calculations are incorrect, you can say goodbye to millions of dollars and the loyal customers that invested the now lost sums. Software in this domain needs to be airtight, solid, and only touched when absolutely necessary while at the same time conforming to strict privacy and security requirements.
Insurance. Actuaries are a critical part of risk assessment and an insurance company’s bottom line. In days gone by, actuaries would perform calculations by hand or with the assistance of large textbooks of precalculated metrics. But now there are entire software suites and algorithms designed specifically to calculate risk using massive datasets through the use of parallel and cloud computing.
As more citizens of the world are lifted from poverty to join the ranks of modern civilization, the need for digitally tracked currencies, investments, and bonds is growing rapidly. No longer can we rely on a physical ledger of assets. Instead, we now rely on armies of engineers in various professions to design systems that can withstand the onslaught of rapid globalization.