Eastern Europe is known as one of the world’s top IT outsourcing markets thanks to its quality to price ratio and a growing talent pool. Apart from cost-saving, many US and European companies choose Ukrainian, Polish, Hungarian, Bulgarian, and Romanian developers for their skills, experience, and ability to work well in cross-cultural teams.
The choice of the outsourcing destination usually depends on many factors, including service quality, talent availability, as well as the business ecosystem. In this article, we will focus on:
- Availability of resources and talent inflow;
- Hard and soft skills of Ukrainian and Romanian developers;
- And overview of the IT infrastructure.
Both Romania and Ukraine are in the top 3 countries by the number of software developers in Eastern Europe. Ukraine has over 192,000 developers. As for Romania, there are nearly 119,000 IT experts. Romanian developers are ranked 23 by SkillValue and 20 by TopCoders, while Ukrainian developers occupy the fifth and six positions respectively.
Many developing countries of Eastern Europe are widely known as the home to the world’s best chess players, mathematicians, and engineers, including software developers [2,3].
For Romania and Ukraine, the industrialization of the second half of the 20th century resulted in the boom of technical education. The educational background gives Ukrainian and Romanian developers the high ground on the global software development market. As for IT education in Romania, a little over 7,500 new specialists graduate from local universities and colleges, while Ukrainian universities and colleges have 16,000 ICT and 23,000 engineering grads every year.
There are also nearly 14,500 Cloud engineers in Romania. Ukraine has a slightly larger pool of Cloud specialists - 21,800. The similar difference is in the number of DevOps experts - 5,600 and 9,600 respectively.
Both Ukrainian and Romanian developers have strong communication skills and sufficient level of English.knowledge Romania scored 589 in the EF English Proficiency Index (2020 ranking). A lot of high school students also learn French . That makes Romanian IT developers attractive for French companies who are looking to outsource development to Eastern Europe.
Ukraine is a country with moderate English proficiency (other countries with moderate proficiency are Italy, Belarus, Hong Kong). However, in the IT sector, the situation is better. According to DOU.ua, the number of IT professionals with fluent English skills is 47%, and of those with intermediate level is 34%. The competition among professionals in the field is high, and English is a must to be hired by any company.
Cultural affinity with the US, EU, and UK clients
Cultural compatibility and mutual understanding with your outsourcing partner is an important point to consider when choosing an IT outsourcing destination. Both Romania and Ukraine have a close cultural affinity to the UK, US, and EU.
Both Ukrainian and Romanian developers are known for common sense, positive and flexible attitude, high responsibility, and a good sense of teamwork. Ukrainian developers have experience in communicating with foreign clients, mostly from the US, the UK, and Western Europe. Many of them have international education or working experience abroad. Together with general emotional intelligence, it makes a great combination to deliver high quality software products.
Software developers’ rates in Romania and Ukraine
Deloitt’s survey  states that cost reduction is once again one of the top reasons for IT outsourcing. As a result, many companies are looking for outsourcing destinations that can offer high quality services for a lower price range. Let’s take a look at the comparison of the average annual rates in the US, Canada, the UK, and Europe.
Both in Ukraine and Romania, developers are paid 20% to 50% lower compared to European or American markets. However, this does not compromise the quality of their services. Eastern European countries have a lower cost of living and taxes, and IT outsourcing companies can offer lower rates there.
Eastern European IT sector has seen continuous growth over the last decade, despite political issues and the economic crisis. Both countries take necessary steps to maintain the IT sector growth rate. While having a similar turnover of the software and IT services sector ($4.5B in 2019), Ukraine shows a higher growth rate compared to Romania.
Ukraine ranks 20th in the Global Services Location Index, 8 positions higher than Romania. However, Romania has scored better in the Doing Business index by the Wold Bank.
Next, let’s take a look at the number of IT services providers in both countries. Clutch lists 25 companies with 250+ Romanian developers and only four companies with over 1,000 software developers in Romania. On the contrary, Ukraine has over 40 vendors that employ more than 250 engineers and 13 firms that have more than 1,000 contractors.
The recent study  shows that 75% of Romanian software development companies work for foreign clients. They include European (74%) and the US (22%) companies, with a tiny share of other countries. On the other hand, Ukrainian software development companies work primarily for foreign clients (US - 50%, UK & EU - 35%, 8% - Canada, and others).
R&D centers in Romania and Ukraine
Both countries have experience working with tech giants from all over the world. Such international giants as Samsung, Ericsson, Boeing, Oracle, Siemens, Wargaming, UpWork, Google, Cisco and over 100 other global companies of different industries, including gaming, telecommunications, software, and e-commerce have chosen Ukraine as a location for their R&D centers and offices. Romanian developers work for R&D centers of IBM, Siemens, Adobe, Intel, and Oracle.
Many American and European companies choose Eastern European outsourcing firms as partners for augmentation of their onsite IT departments. Among the many reasons are cost-effective outsourcing, well-developed infrastructure, as well as the experience and qualification of both Ukrainian and Romania developers.
Providing services of the highest quality, Ukrainian and Romanian developers are successfully using a chance to show the global IT community what they are capable of.
Why choose N-iX for outsourcing software development in Eastern Europe?
- N-iX has a talent pool of over 1,200 tech experts. Our recruitment team consists of 30+ experts and we have a database of 95,000 experts from Ukraine, Poland, and Belarus.
- We have a strong employer brand, which helps us attract top tech talent.
- With almost 20 years in the market, the company has formed long-term, strategic partnerships with businesses from the USA, UK, Germany, Nordic countries, and other locations.
- We have been recognized as a trusted vendor by Zinnov, IAOP, GSA, Inc. 5000, Software 500, Clutch.co, and others.
- N-iX is a certified AWS partner, a Microsoft gold certified partner, a Google Cloud Platform Partner, an Opentext Services silver partner, and a SAP partner.
- Software development in Ukraine, Poland, Belarus and Romania [Report]
- Where to find the best developers in 2019? SkillValue Report by Pentalog
- TopCoder Country Rankings
- Over 95% of Romanian secondary school students study at least two foreign languages by Romania-Insider.com
- 2020 Global Outsourcing Survey by Deloitte