Original poster here. I'm reposting this blogpost from Steve Yegge because it's so relevant, we're seeing students who haven't been told yet that touch-typing changes your career, and the upgrade you get from it is immense.
I'm skeptical. Developers spend most of their time thinking, not typing. Unless you are literally a 5 WPM hunt-and-peck typist, the lack of touch-typing will not be a bottleneck.
I'm not typing a word and thinking, typing another and thinking some more. When I type I'm mostly typing at speed, and the shape of what's in my head and trying to get onto the screen is changing in time with the typing. Sure, there are fits and starts, hesitation, backtracking. Sometimes I manage a few tens of seconds, sometimes it's minutes and sometimes it's even more. The crucial thing is that when I've formed the idea in my head it needs to get out, the quicker the better. Fumbling with the keys hurts. Hitting the wrong key hurts. Too much time, too many errors that need to be corrected, and the thoughts decay or run away from me and I need to get them back.
