Ukraine’s once-thriving technology industry continues to develop, but much of it has not been spared by the full-scale invasion, and for many in the IT industry, it remains in the unknown while the war continues. Even so, the future remains uncertain. it’s over.
Before the full-scale invasion began, Ukraine was one of Eastern Europe’s major IT hubs.
The tech scene has spawned many famous startups and unicorns, as well as hundreds of software development businesses whose outsourcing solutions have powered overseas companies.
Then the war happened and everything changed.
The IT industry will continue to be Ukraine’s largest services export in 2023, contributing 4.9% of the total gross domestic product (GDP) of $8 billion, although there will be a noticeable decline compared to 2022, Bank data shows an upward trend by the end of 2023.
The instability of war extends to the industry, with professionals hesitant to change jobs and sometimes reluctant to work in the field for fear of military mobilization.
As the full-scale invasion approaches its third year, the Kyiv Post interviewed IT workers in various roles to get a true picture of Ukraine’s wartime technology industry.
great escape
“About 70% of companies have moved abroad,” said Hanna Yankina, a Poland-based recruitment manager who works for IT companies in the United States and Ukraine.
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Yankina said most IT companies in Ukraine moved to the country’s western regions at the start of the invasion, and 50% of them moved some or all of their operations overseas.
“Companies mainly relocated to countries where they had already opened offices or agencies, such as Poland, Germany, Spain, Romania, Bulgaria and Portugal,” she said.
“Events like the Silicon Valley Bank collapse caused some people to have flashbacks to 2008.”
Layoff trends
Businesses also laid off employees, although it may not have been entirely due to the war.
“On the other hand, many companies laid off employees, usually not key personnel,” Yankina said.
Alex, a sales manager at a mid-sized software development company, also noticed job cuts in the industry, but believed it would take a long time.
“For developers, that’s definitely true. Global companies like Google and Microsoft have laid off a lot of people in the last few years. This has led to more people being laid off. [in] Labor market with few vacancies.But this is also a global thing [trend] It has nothing to do with war.
“[The] The industry began adjusting after the coronavirus outbreak and laid off employees who were no longer needed.then global [economic] The impact on the industry also led to further declines. “Events like the Silicon Valley Bank failure have given some people flashbacks to 2008,” Alex said.
Dmytro Adrianov, head of the Regional Affiliates team, said the layoffs could be related to investor-driven decisions and that he would be laid off and rejoin the same employer in 2023 with a significant increase in benefits. He said he was hired.
Yankina said that unemployment has had a widespread impact on professionals at all levels in Ukraine, except for architects, leaders and managers.
“About 11 percent of interns, juniors, and mid-career professionals are currently unemployed and actively looking for a new job, while an additional 5 percent are on the bench or on unpaid leave. Older people fare better; Currently, 8% are unemployed and the remaining 5% are on the bench,” Yankina said.
She added that international staff, including Ukrainians who have moved abroad, are not immune to this trend.
“In both cases, companies appear to be laying off non-key personnel and changing bench policies,” she said.
“Men are not prepared to work in the field because they fear mobilization and want to avoid movement within the city.”
changing landscape
Sofia Tarasova, a human resources specialist in the IT industry, said it was becoming increasingly difficult for new applicants to enter the market as companies looked to cut spending.
“Since last year, we have noticed that many positions have been consolidated into one. For example: [Quality Assurance] Testers also need to code something simple or do business analysis.
“It has become difficult to enter the market. Newcomers face the problem of very low salaries for the first year or two,” Tarasova said.
Yankina has noticed a similar trend.
“Although we are receiving more resumes, the number of high-quality resumes for senior positions has decreased. Although this is not the case for the most qualified candidates, salary expectations have decreased by about 20%.” said Yankina.
The war also affected working conditions and preferences.
“Men are not ready to work in the field because they are afraid of mobilization and want to avoid movement within the city,” Yankina added.
Regarding interviews, Adrianov said he has noticed an increase in interview opportunities over the past two years, but finding the right person has not been easy.
“There are plenty of opportunities, but finding the right partner is key,” he said.
Regarding Ukrainian companies that have moved abroad, Yankina said she still supports Ukrainian candidates due to cultural differences with local residents.
“There is a noticeable trend among Ukrainian companies that the hiring of local European candidates is less prevalent. “This is because the cost of doing so is high and they are often unprepared to adapt, about twice as much as Ukraine,” she said.
Yankina added that the only exception would be companies that were based overseas before a full-scale invasion.
Relationship with overseas customers
Yankina said the war has caused some hesitancy among foreign clients to work with Ukrainian teams, but not necessarily.
“New clients are often hesitant to staff in Ukraine due to the perceived higher risk. Conversely, existing clients may choose to continue collaborating with their current engineers. is common.
“Generally, large companies adopt a cautious approach to security considerations, while smaller clients are more willing to accept risks,” said Yankina, who worked with the Ukrainian team in 2022. It added that companies with positive experiences are more likely to expand cooperation.
“However, their decisions will also be influenced by global market conditions and the ongoing economic downturn around the world,” she added.
Alex said the full-scale invasion had an initial impact, but the situation gradually returned to a “new normal.”
“When the war started, there was confusion at first and some customers were very concerned about working with Ukrainian IT companies. But after a while, things started to return to the ‘new normal.’ Ta.
“We also encountered some issues with our clients during the 2022-2023 winter power outage, but clear communication with them helped us address their concerns,” Alex explains Did.
“Some people may disagree with my opinion, but I know that I will move abroad.”
uncertain future
As the war rages on, businesses are beginning to accept the fact that it won’t end soon and, like countries, are preparing for a long war.
“In 2022-2023, market players initially tried to overcome the challenges brought by the war and expected a quick resolution,” Yankina said. “However, as the year progressed, there was a growing realization that the war would be prolonged and lead to a more difficult business environment.
“Companies incurred significant costs, including relocating employees and preparing for potential power outages. […] “Nevertheless, as the war is likely to be prolonged, corporate leaders are now focused on maximizing business adaptability,” she said.
However, Alex does not have high expectations as he believes that once the war ends, this country will lose its human resources.
“This is my personal opinion and I could be wrong, but I think the biggest changes will occur after the war ends and the borders are reopened.
“What our government is doing now is going to result in a lot of IT people leaving the country. They want to mobilize everyone they can get and have no functioning mechanism to book workers. lack of( [government] We would like you to believe that such a mechanism exists, but check out the number of reserved IT workers in 2023). [plainly] “Lying to people is going to be a major trigger for IT people to leave,” he said.
“Some people may disagree with me, but I know I’m going to move overseas. And lately I’ve been hearing a lot about people who have the same plans.”
But there may still be a glimmer of hope for Adrianov and Tarasova.
“With a flexible workforce and a willingness to take on new challenges, Ukraine’s IT sector is well positioned to grow in the global market,” Adrianov said.
For Tarasova, Ukraine’s strength lies in its adaptability.
“In my opinion, the advantages of Ukrainians are [developers] It’s adaptability to the market and smart brains.we [the] First in the world to digitize documents and data such as IDs and taxes [numbers]etc., and the steps related to this field, [Diia app].
“I think we will move forward in this direction,” Tarasova said.
