Kyiv is the capital of Ukraine with an ancient history and is definitely an undiscovered European gem. The Ukrainian culture impresses everyone who touches its roots but in the tech world, Kyiv is best known as a hub of IT. Prior to the war, the IT sector was performing more than excellent in the country. When Russia invaded Ukraine, many analysts expected the economy to get ruined but to many people’s surprise, some industries showed unbelievable resilience and kept on showing it for almost a year already.
We can say without hesitation that the IT industry of Ukraine can be called a phenomenon as not only did it not fail, but it also continued to flourish in conditions that seemed impossible to do so. But what exactly helped the Ukrainian IT industry to grow despite the unfavorable conditions?
The very first thing is that all challenges are carried out with maximum efficiency. The industry quickly adapted to new realities and even created its own conditions and rules for its growth. According to the latest research, ITC businesses will continue to grow and expand as up to 93% of companies will continue their work in Ukraine. Also, global investors see the Ukrainian IT sector as very attractive so they are eager to invest. Even though many had to relocate to other cities or even countries, over 80% of tech talents have returned to their work which raised respect from people all over the world.
Based on this, powerful pre-war background, expertise, worldwide trust, industriousness, and foundation helped the IT sector of Ukraine stay strong. It wasn’t the first time Ukrainian businesses showed tremendous growth despite the circumstances. While the IT industry in some countries struggled with COVID and faced recession, Ukraine managed to grow up to 20%. Hubs in the largest Ukrainian cities like Kyiv and Dnipro kept on performing well and signing contracts with new clients from all over the world.
The pre-war tech talent pool in Ukraine totaled more than 280, 000 people, and over 850 companies provided their IT services. As for higher education, there are 660 institutions that allow professionals to get a degree in the IT sector. Thus, 84% of IT specialists have higher education and most of them are fluent in English.
The reputation of the Ukrainian IT industry is brilliant because way before the war, the country successfully created a favorable climate for it and maintains this reputation. Taxes and the government’s involvement in the IT sector growth play a big role as well. Prior to 2022, the most common type of taxation for IT companies was to pay 20% VAT and 18% corporate income tax.
Today, a project that was presented by the government which is called Diia City, opened new opportunities to Ukrainian and international IT companies. The platform allows opening a business or R&D in several clicks and offers flexibility, a special tax regime, and other things like investment protection.
Ukraine is the top destination for worldwide outsourcing. Businesses from all over the world see Ukraine as a place to open the doors of their offices which proves once again that the Ukrainian IT sector is solid. Over 4,000 worldwide known tech giants, including Snapchat, Google, Samsung, and Boeing have their R&D in Kyiv.
Also, Ukraine itself is home to several world-famous unicorns like Ring, Grammarly, GitLab, ai, and Reface. All of them were made in Ukraine and are used by millions of people all around the world.
Even though Ukrainian tech talents are globally trusted, their salaries are not that impressive. If you compare the average salary of a software engineer from Kyiv and the same professional who is based in the US, you will see a huge difference. The first one earns around $2, 000 per month while the second one makes up to $10,000! The work would be done perfectly well in both cases but the amount the customer pay is completely different. That is why the US is the number one customer in the Ukrainian IT sector.
Summing up, it is important to say that the war did not kill the Ukrainian IT sector, on the contrary, it not only remained stable but continues to grow. The country has created a great pre-war IT background and has tech talents that are trusted all over the world. IT sector in Ukraine will continue to grow even further and its future is bright. A nation that could successfully overcome such obstacle as the war and kept growing can definitely cope with anything.