According to DOU Ukraine outsourcing software development activities to Ukraine allows to save from 40% to 60% of costs while the workforce costs half as much as in the EU countries. Solid technical education in combination with R&D institutions inherited from the period when Ukraine was the major tech hub in the USSR makes the county very attractive for foreign companies. Ukraine has great resources in mainstream technology skills including .NET, Java, PHP and some rare and highly required skills including mobile, EPR and iGaming. In this article we’ll bring light to some main characteristics of the modern Ukrainian IT market.

Quick facts about the Ukrainian IT industry

  • In 2013 IT market value reached $2 billion USD
  • Over 100 Research and Development centers
  • IT market grows 20-30% annually
  • 50,000+ employees involved in IT sector
  • 500+ IT outsourcing companies
  • 5,000+ software engineers employed
  • Ukraine has the largest IT outsourcing market in Eastern Europe
  • Software development cost is 20% lower in comparison to Russia and Belarus
  • Ukraine is included into the top 10 countries with the largest number of certified IT experts
  • Experts predict Ukraine’s IT outsourcing market to double its value by 2016
  • Main IT outsourcing centers in Ukraine are Kyiv, Lviv, Kharkiv, Dnipropetrovsks, Odessa

Structure of the Ukraine’s IT market

Ukrainian IT-products market is rapidly growing over several past years with annual increase over 25%. It consists of two main parts — IT outsourcing and delivering IT products for the internal market. According to Information-Analytical Bulletin of the Cabinet of Ministers of Ukraine IT-services export makes over 50% of the country’s IT market with 40%В average annual growth. IT outsourcing industry becomes more and more attractive in terms of foreign investments. According to official data the current situation with Ukrainian IT market is as follows:

  • In 2012 approximately 25 thousand certified software developers were working for export
  • State Agency for Science, Innovations and Informatization of Ukraine predicts than in 2015 the number of working places in IT sector will reach 168,5 thousand including 106 thousand in IT export and 62,5 thousand — on the internal market
  • The Ukraine’s IT sector is expected to involve 350 thousand specialists and the volume of products and services in 2015 will exceed 5 billion dollars
  • According to World Bank’s estimates Ukraine can claim the 6th place in the world by the volume of IT export in 2015

Conclusions

Generally Ukraine is the natural choice for outsourcing combining favorable geographical position and time zone, extensive IT talent pool, strong technical and scientific legacy and cost benefits. The majority of foreign and domestic experts agree that the country’s IT-sector (especially its part working for export) will keep on growing in the next years. Despite economic and political instability the IT-sector has been permanently growing since the year 2000 and this trend is expected to proceed.

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