The Numbers Behind the Rise of Ukraine as a Staff Augmentation and Distributed Engineering Super Power

When considering the best countries for staff augmentation, leaders need to think about several factors, and Central Eastern European (CEE) countries are increasingly ticking all of the most important boxes for a great deal of companies. There are many reasons why Poland, Belarus, Romania, and Ukraine make great locations for outstaffing. It’s certainly no accident that so many major players in verticals as diverse as the automotive industry, financial services, travel, and blockchain operate and in the region. When you begin to look more closely at the facts behind the current boom in outstaffing in Eastern Europe, one thing becomes apparent – extremely quickly. The area isn’t just a hub for software and app development; it’s an incubator for software and firmware specialists and a vast array of other engineering professionals too.

Outstaffing Industry in Eastern Europe: A Nation Punching Above its Weight

Eastern European countries occupy fifth place in a global league of software development locations. Impressive is an understatement when you consider the size of the countries above them, like Brazil, South Africa, India, and China – and that’s not even to mention populations. Approximately 109 million people live in Belarus, Poland, Ukraine, and Romania. Compare that with India and China (1.3 and 1.4 billion respectively), and it becomes more obvious there has to be something tangible behind the fact Eastern Europe places where it does.

Staff Augmentation: Why Location and Time Zones, Language and Culture Matter

Let’s face it; distributed engineering can be successful to varying degrees. No matter how many developers a country has, and despite their quality, things like time zones and language barriers can have a massive impact on the day-to-day realities of outstaffing. For companies in the US and the UK, India and China represent time differences of up to 13 hours. That means windows for communication can be narrow or non-existent and don’t always promote on-the-fly collaboration. In comparison, time differences between CEE countries and the UK can be as little as 2 hours, which partly explains why 70% of demand for CEE outsourcing services comes from Western Europe and the US – yet, that doesn’t tell the whole success story.

Outstaffing in Eastern Europe – IT as an Export

We’ve already seen how CEE countries punch above their weight in terms of population figures, but how do they do against India and China when it comes to revenue generated from software development? If anything, those figures are even more impressive. During 2017, Belarus, Poland, Ukraine, and Romania generated 13 billion USD from the sector. India managed 111 billion, and China 38 billion. That’s four Eastern European countries generating an amount significantly more than 10% of China’s revenue, with a combined population approximately 4% the size. The slide below not only illustrates that achievement, but it also hints at one of the most significant reasons behind CEE’s ongoing staff augmentation success.

Central Eastern Europe – Educating Tomorrow’s Distributed Engineering Teams Today

Despite relatively humble population figures, Poland, Ukraine, Belarus, and Romania boast 210 universities and colleges between them. A healthy increase in demand from the US and Western Europe isn’t just matched by a commitment to educational excellence that churns out 60,000 IT specialists each year – it’s fueled by that too. What’s more, there’s an exponential element to that growth. The four countries have a pool of talent that’s already well over half a million strong, and business activity in the region further promotes expertise. On top of the educational conveyor belt, nearly 500 companies employ more than fifty people in software development roles, with 100+ developers working at more than 250 firms and 28 companies employing more than 1,000 each.  

Ukraine: Distributed Engineering Experience, Educational Excellence, Bright Future

In some ways, it’s a tough task picking one of the four countries featured in this article as stand-out. It’s no mystery why Poland, Belarus, Ukraine, and Romania have climbed the global outstaffing ladder. It’s also no accident why CEE countries compete so readily with nations many, many times their size. It’s hard, however, to look past Ukraine for its superior educational infrastructure, location, culture, and livability. As well as having some of the most beautiful and progressive cities in Europe, it offers much as a technological center.

Ukraine has 150 universities and colleges. That’s almost three times the educational power of Poland, Belarus, and Romania combined, representing nearly 75% of establishments across all four countries. Ukrainian investment in educational infrastructure provides a constant stream of junior-level software engineering professionals. However, a high number of larger companies in the area, combined with healthy outstaffing and outsourcing industries, have also created a dynamic, healthy environment that has resulted in a considerable pool of mid and senior-level developers too. The attraction for companies looking to source distributed engineering teams is clear: in Ukraine, education and expertise combine to offer a ready supply of candidates at the junior level, all the way up to some of the most qualified engineers and experienced engineering team leads.

That talent base is just one of the reasons outstaffing is emerging as a formidable method for staff augmentation within CEE countries – and why so many companies choose to base operations in CEE too. Yet, culture and language are also playing a part in Ukraine’s staff augmentation success. Cities are considered more culturally Western facing when compared to some other countries. IT specialists in the region are predominantly aged under 30, possess a global outlook, and many Ukrainian developers have an excellent grasp of English as a result. All those factors go a long way when doing business to the West, and they’re driving ongoing growth in the industry.

Ukraine: Leading the Way with Outstaffing in Eastern Europe

If you’d like to find out more about why the outstaffing model is driving success in Ukraine and wider CEE, contact Agile Fuel today – and tap a whole region of software development expertise without the hassle and cost of employing a team yourself. More and more companies are using outstaffing to get on-demand distributed engineering teams with the flexibility to expand and contract directly at the point of need, with no long-term contracts.

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