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Why building software development in Ukraine is a good idea?

General | 5 min read • 16 May 2016
Why building software development in Ukraine is a good idea?

Today more and more organizations of all sizes are choosing to adopt a distributed architecture that allows them to outsource IT functions, with staff working in different places, on different projects, with relative autonomy from each other. 

Ukraine as an IT outsourcing country is not breaking news. Many European countries are already aware of benefits from working with their own local European IT hub, some of the global software companies as well.

Let's try to dig a little bit deeper and look through all the pros and cons (this is just the expression, just cons) of working with Ukrainian IT fellas.

 

What Ukraine has now?

More and more global companies recognize Ukraine as a playground to experiment with new products and make quality research. Many are already aware that via outsourcing in Ukraine will they get skilled personnel combined with low production costs.

Along with 4000 IT companies that are functioning in Ukraine, and outsourcing companies that are already working with Europe and the US and along with hundreds of educational programs.

 

Let’s look through some facts about Ukrainian IT today.

Ukrainian IT market is valued over $5 billion in 2015 and is built by more 90 000 of IT specialists. And more than 20 000 of students are ready to join the software development market every year, thus every month Ukraine produces a couple of thousands of coders.

The number of IT specialists will reach the number of 200,000 professionals by 2020. 

The majority of big companies specializes in software outsourcing services to customers in the US and Western Europe, which means that more than 20 thousand IT specialist is already importing their well known worldwide professional skills and you are still missing out.

The concentration among technologies is responding to demands, right now top five technologies are Java, C#/.NET, PHP, JavaScript, C++ and you can’t miss out on mobile yearly mobile usage growth and mobile development growth as a result. But Ukraine is not only responding to demands but creating its own technologies as well if you want to be first to know it, you should be present.

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Here are some numbers on Ukraine IT market:

  • In 2011, Ukraine was featured as the “Outsourcing Destination of the Year” by the European Outsourcing Excellence Awards. 
  • According to Bloomberg 2015 ranking, Ukraine is one of the world’s 50 most innovative countries. Ukraine took 33rd place achieving a great performance index in Education category which measures the education levels of a country’s workforce. 
  • Over 100 Fortune 500 companies including Google and HP outsource IT services to Ukrainian companies 
  • Ukraine takes the 1st place in Europe ranking based on the volume of exports of IT service under the “Tech Ecosystem Guide To Ukraine” by Unit.city 
  • The Global Sourcing Association has recognized Ukraine as the UK’s best delivery destination of the year.
  • The Global Outsourcing 100 included 18 Ukrainian tech companies as the best IT services suppliers in their annual ranking of 2018

We surely can conclude that it is an attractive market to make an investment in people and their talent.

The great news for outsourcing is also that you can not only be serviced by IT professional but today, most likely, you can work with him or her directly. We can claim that because statistics of developers’ English knowledge are in our favor now. 

Fluent English speakers’ number is increasing constantly and it now amounts to 40.2%. And the total number of fluent-intermediate level speakers is 78.8%. Thus technical specifications, documentation or communication won’t be a problem anymore.

 

What are your benefits?

Let’s stop here and talk about salaries in Ukraine. An average salary for a senior software developer in Ukraine amounts to 3000 $/month. 

It depends on location, work experience, and other factors, but you can’t hide from the fact that in any case, it’s not even twice a number from the salary of Western European or USA equivalent coders (and we’re not even talking about New York or London).

Just a couple of examples that will clarify the difference:

We haven’t even started to talk about taxation. By the way, Ukrainians have a simplified method of salary taxation for IT specialists and in 2016 it equals 4%.

As a result, Ukrainian outsourcing or outsourcing companies with a development center in Ukraine will definitely offer you an hourly rate of 4-12 times lower than average in the USA or Eastern Europe.

 

How tomorrow will look like?

We mention hundreds of technical schools and universities, but the world is now going further than just conventional education. You no longer need to be in the same place as you facilitator and in informational technologies, you sometimes don’t need a facilitator or tutor at all. 

For instance, there is now officially launched education program Technology Nation, which is held in 2016 in 22 cities of Ukraine. The classes are based on Harvard, Stanford and MIT IT development educational programs. And it’s free, like almost every other IT educational program in Ukraine. 

This way country has a huge amount of programs for every city, every level of previous experience and for every age. There are also preschool education programs for kids.

Based on that and other factors of the growing software development sector in Ukraine, we’re expecting a hundred thousand programmers more by 2020. The IT industry in Ukraine can overwhelm even agriculture and metallurgy and transform a huge raw material supplier into a technology exporter.

 

Summary

The only trick of the situation is that the lower index of demand/supply of IT employees in Western Europe is and the more Ukrainian developers are helping to compensate this problem the higher salaries expectations for them will be. Low taxes are also just an instrument to stimulate IT market growth.

But don’t panic, you don't have to look any further, Softremii provides a full cycle of software development services and employed best senior-level IT specialists available in the industry in Eastern Europe.

Contact us any time and we’ll provide you with a tour of the Ukrainian informational technologies world. So just can’t miss your chance to take advantage of great market conditions. If you’re going to outsource from Ukraine, that’s probably a great idea.

 

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