Regional Structure of Ukraine’s IT Outsourcing Industry: Kharkiv

Recently we started the series of posts about the regional structure of IT outsourcing industry in Ukraine. Ukraine is the leading country in the CEE region with the IT outsourcing market volume of more than US$1 billion.

Although IT outsourcing companies are located all over Ukraine, it should be noted that there are six main outsourcing centers: Kyiv, Kharkiv, Lviv, Dnipropetrovsk, Odesa, and Crimea cluster (includes cities Kherson, Mykolaiv, Simferopol, and Sevastopol).

Today’s post is devoted to Kharkiv region, the second largest outsourcing center in Ukraine after Kyiv, and the specifics of its IT outsourcing market.

Kharkiv Region

Kharkiv is a key region with great competitive advantages and the growth potential. It is historically and geographically molded, that each region in Ukraine is distinguished by its own specifics, its own strong suits. The South-Eastern and especially Eastern region of Ukraine is the most developed in industrial, intellectual and technological spheres. The Kharkiv region used to be scientific and industrial center in USSR and is known worldwide for work in machinery – aerospace, nuclear electronics, turbines, arms, etc.

Kharkiv, the former Ukrainian capital from 1918-1934, is now the second largest city in Ukraine with the permanent population of almost 2 million people.

The Kharkiv region is considered to be one of 3 primary R&D outsourcing destinations. About 200 IT companies of various sizes and service offerings operate here.

Human capital is a main indicator of the region’s competitiveness, and the region has many highly skilled laborers, because it has one of the country’s most extensive education networks. There are 43 universities that prepare about thousands of graduates annually. Moreover, 4 major Ukrainian technical universities are located in Kharkiv. Each year about 3,000 IT specialists graduate from the higher educational institutions and 25-30% of them join software development companies.

Kharkiv can boast the second largest IT talent pool in Ukraine. About 5,000 highly qualified IT specialists are engaged in delivering outsourcing services, that is 20% of all IT outsourcing resources in Ukraine.

The Kharkiv region is the large region with high level of economic development, well-developed infrastructures and communications but with smaller prices and lower cost of living. The region offers the large pool of the talented but cost-effective IT workforce, as salaries and infrastructure costs here are about 15% lower of the Kyiv region.

Among the specifics of the IT outsourcing market in Kharkiv is the presence of large and strong professional IT communities. It is worth to mention the Kharkiv QA community – QAClub and the Kharkiv community of developers – Dev Time . These IT communities unite IT specialists and hold different meetings and IT events in order to exchange the knowledge and gain new skills and competence.

The city was chosen to co-host the European Football Championship. As preparation to EURO 2012 a lot of improvements have been made to the city infrastructure. Kharkiv International Airport has been modernized; the new terminal has been opened.

Being located in Eastern Ukraine, Kharkiv has convenient airline and train connections. There are daily direct flights from Kyiv (about 1 hour) and from Vienna (about 2 hours), as well as daily trains from Kyiv (about 6-8 hours). A lot of airlines operate in Kharkiv International airport: Austrian Airlines, Aerosvit Airlines, Armavia, Dnepravia, Georgian Airways, UTair, and others.

The Kharkiv region is one of most promising and well-developed regions with relatively inexpensive life rate. In 2009, Focus Magazine included city Kharkiv to the ranking European Cities and Regions of the Future 2010/2011 and ranked it the 3rd in the TOP 5 Major Cities in the category Cost Effectiveness.

Offering a large pool of highly skilled IT specialists, great cost savings and many other advantages, the Kharkiv region attracts IT outsourcing services consumers as a promising outsourcing destination.

Presentations of the Kharkiv region:

Presentation of Khrakiv region by eSP

Presentation of Kharkiv region

Presentation “Outsourcing in CEE. Country Overview – Ukraine. Kharkiv Region”

List of  outsourcing companies in Kharkiv from catalogue