Why Ukraine is a great place to look for an outsourcing partner?

Information technology is one of the few industries that has retained the ability to grow even in times of crisis. Ukrainian outsourcing companies have somewhat lost the growth rates, some had to reduce wages, others had to dismiss part of employees, however, such changes were applicable to the companies with the worst “price-quality” indicators, meaning insufficiently qualified or too expensive. But as they say, every cloud has a silver lining – the crisis became the “sanitar” of Ukrainian outsourcing and brought it back to life.

So, what’s next? The prospects of Ukrainian main competitors – the Eastern markets – China, India – are extremely clear and do not cause doubts – the availability of a huge amount of resources, cheap rental space, state assistance in education, tax incentives, etc.

And what about Ukraine? Once again, market globalization and the non-desire of leading IT companies to keep the “eggs in one basket” are on it’s side. Of course, there are some strong competitors in Europe – Romania, Belarus, Russia. However, there are certain problems everywhere, and Ukraine very competitively competes in this list.

Figures indicate that in the beginning of 2017 Ukrainian IT industry has employed about 100 000 specialists. Outsourcing remains the main source of income of Ukrainian developers, and the local market is almost non-competitive. Average salaries in the industry are about $2000.

Top 5 largest IT-companies in the country – EPAM, SoftServe, Luxoft, GlobalLogic and Ciklum – employ over 15 500 specialists, according to Dou.ua.

Top 20 largest IT-companies in Ukraine

Company Sites involved in development process Number of specialists in Ukraine Number of technical specialists Open positions in Ukraine
1. EPAM Kyiv, Kharkiv, Lviv, Dnipro, Vinnitsa 4600 4100 135
2. SoftServe Kyiv, Kharkiv, Lviv, Dnipro, Rivne, Chernivtsi, Ivano-Frankivsk 4491 3427 206
3. Luxoft Kyiv, Dnipro, Odessa 3700 3350 190
4. GlobalLogic Kyiv, Kharkiv, Lviv, Mykolayiv 2832 2473 188
5. Ciklum Kyiv, Kharkiv, Lviv, Dnipro, Odessa, Vinnitsa 2526 2194 183
6. NIX Solutions Ltd. Kharkiv 1500 1400 42
7. Infopulse Kyiv, Kharkiv, Vinnytsia, Zhytomyr, Chernihiv 1309 1177 87
8. Netcracker Kyiv, Odessa, Sumy 1065 847 62
9. DataArt Kyiv, Kharkiv, Lviv, Dnipro, Odessa, Kherson 1060 940 115
10. ELEKS Kyiv, Lviv, Ivano-Frankivsk, Ternopil 987 748 54
11. EVO.company Kyiv 840 120 60
12. Miratech Kyiv, Kharkiv, Vinnytsia, Odessa 760 670 25
13. Lohika Kyiv, Odessa, Lviv 720 588 25
14. Sigma Software Kyiv, Odessa, Lviv, Kharkiv 706 585 75
15. Terrasoft Kyiv 700 500 120
16. ISD Lviv Dnipro, Zaporizhzhia, Berdyansk 700 680 5
17. Plarium Kyiv, Odessa, Lviv, Kharkiv 700 310 15
18. Playtech Kyiv 630 504 22
19. EVOPLAY Kyiv 625 680 68
20. GeeksForLess Inc. Kyiv, Lviv, Mykolayiv 623 310 25

 

There are about 1400 open positions, and totally in the top 25 largest Ukrainian companies the deficit of staff exceeds 2200 specialists. In the next five years, the industry will need another 100,000 workers. If it retains the growth rates of revenue by then, IT industry will be able to earn $ 7 billion in export. Comparable figures show the agrarian-industrial and metallurgical complexes today.

Market participants assure: the Ukrainian IT industry could develop even faster, however, there are two constraining factors. Firstly, local companies compete for talent, not only between themselves but also with foreign companies. European demand for IT specialists reaches up to 1 million people, the same situation is observed in the USA. By the 2020, the country is able to prepare 100,000 professionals. But now the emphasis should be made on quality, instead of quantity.

The second problem is the security of IT business. And it’s not just about military operations in the East of Ukraine. There is no doubt that the threat of an escalation of the conflict discourages foreign customers, who value the fact that the work on the projects does not stop even for a minute.

Despite these problems, investors do not stop investing money into the Ukrainian IT sector. Last year, domestic IT companies have raised $100 million of investment.

There are several reasons for working in Ukraine: Ukrainian engineers make a high-quality product of the global level, and their services are relatively inexpensive. Now everything really depends on the Ukrainian IT companies themselves – on their approach to making business and the orientation at  the end-results.

 

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