In the subway, in shelters, under shelling, during breaks between relocation to safe places, with Starlink and under the sound of generators – Ukrainian tech specialists did what they do best during the year of full-scale war: they worked tirelessly, launched new apps and websites, donated and grew. And each tech company not only became a true fortress for its employees, but also a reliable support for the economy of Ukraine.
Together with the member companies of Lviv IT Cluster, we have selected 5 key figures that, in our opinion, best describe the year of full-scale war for the tech industry.
The tech industry became the only export sector that grew despite the full-scale war. In 2022, the export revenue of information technology services increased by 5.85%, reaching a record $7.3 billion. This is $406 million more than in 2021. However, this growth could have been much higher, at least as high as in 2021, the year of the pandemic, when growth was 38%. Nevertheless, the full-scale Russian aggression restrained the industry from developing to its full potential.
“These figures are not unexpected for the Lviv IT Cluster. Back in the summer, we prepared the IT Research Resilience study, which predicted various scenarios for development: from an optimistic one at $8.5 billion to a pessimistic one at $7.2-7.5 billion. Unfortunately, the worse scenario came true at the end of the year,” says Stepan Veselovskyi, CEO of Lviv IT Cluster.
From the first days of the full-scale invasion of Russia, the tech industry has been involved in helping the state and the Armed Forces. According to the research by Lviv the Cluster, 89% of tech professionals financially support projects that bring Ukraine closer to victory. Of these, 14% donate more than a quarter of their family income.
“During wartime, PLVision’s specialists revealed themselves in a special way. Someone is engaged in writing and cultural promotion of Ukraine in their free time. Someone volunteers to improve the lives and social opportunities of children affected by war. Someone helps with the purchase of necessary equipment for the military. And there are many similar stories. Also, some of our colleagues joined the Armed Forces“, shares Olena Kozlova, co-founder and CEO of PLVision.
Tech companies have also actively joined the fight against Russian aggressors. 96% of them financially support volunteer projects or create their own. Lviv IT Cluster, together with its partners, has also joined in to help the country and the Armed Forces of Ukraine. Since the start of the full-scale offensive, the community has launched the Victory Projects initiative. Last year, 69 million UAH were successfully directed to Victory Projects.
“Already on the second day of the full-scale invasion, we realized that action was needed. Thousands of people began arriving in Lviv from regions where fighting was taking place. And we decided to set up centers for temporarily displaced people. In total, we provided 1200 sleeping places. Then a whole series of important projects was launched aimed at supporting the country, the region, and strengthening security and helping the military: Vision, SKY, Starlink, Shelter Link. Our community has a clear goal – to support the Armed Forces and Ukraine until victory and even after,” adds Yuriy Ohonovskyi, Deputy CEO of the Lviv IT Cluster.
The full-scale war has forced many tech professionals to seek safer places to live. According to the IT Research Resilience study, from 50 to 57 thousand industry workers left the country after the start of the full-scale war, with the majority, specifically 64%, being women. This is practically every 5th specialist in the field.
Active military operations in Ukraine have prompted businesses to open new offices abroad. 26% of tech company CEOs reported that they would be opening new offices in other countries. The most popular location choice is Poland, accounting for 20% of those interested. 4% stated that they would choose Spain or the USA, 3% were in favor of Estonia and Portugal, and 2% were in favor of Bulgaria, Romania, and Croatia.
“Diversified teams of tech specialists continued to work without interruption when at the beginning of the war, Ukrainian colleagues were moving to safer locations. Since the beginning of the full-scale war, we have started working with a significant number of new clients, and the presence of development centers in different countries played a significant role in this. By diversifying the development team and thus reducing risks for the client, we are creating some of the vacancies in Ukraine, and this way we can ensure projects for our Ukrainian developers despite the war,” says Oleh Denys, co-founder, SVP of Audit, SoftServe.
In the first months after the February invasion, the tech industry showed a high level of adaptability. According to IT Research Resilience, in May, 85% of tech companies fully or almost fully resumed business activity. At the same time, 63% of them reported positive financial results, and 13% saw revenue growth within the range of 25-50%.
“We had a Business Continuity Plan, probably, like most IT companies. We kept our finger on the pulse of the news, constantly informing people about our action plan in case of a possible emergency, and how the company is ready to help. At the same time, of course, no one wanted to believe that the worst scenario would happen. I am proud that when the H-hour came, all our specialists acted as coordinated as possible. We continued to work no matter what, closing the most critical issues, and on February 28, 2022, we have already resumed all operational activities“, recalls Olena Kozlova, co-founder and CEO of PLVision.
Due to regular massive attacks by Russia on Ukraine and its critical infrastructure, foreign clients have become more cautious about hiring developers for projects in Ukraine. It is particularly difficult for Junior specialists to find work, as foreign customers tend to prefer Middle and Senior qualified professionals. At the same time, the number of career switchers who have decided to enter the tech industry is increasing in Ukraine. Mostly, these are people who lost their jobs due to the war or who want to be more mobile and have the opportunity to work from anywhere in the world. As a result, the market is saturated with newcomers who cannot find work.
According to the job vacancies website Djinni, the pace of tech hiring has slowed down by 13%, and in January, 69,000 tech specialists applied for 14,000 vacancies. This trend is confirmed by leading tech companies.
“Before the start of the full-scale invasion, on average, 68 new specialists joined the company per month, and in 2022, the number of new hires slightly decreased – on average, 37 new colleagues become part of ELEKS per month. Despite the growth slowdown at the end of 2022, as well as the completion of some contracts, the company, like during COVID in 2019, maintained cooperation with specialists at the end of 2022,” says Ruslan Seredyuk, Chief Engineering Officer at ELEKS.
According to Ciklum, the situation is similar. Compared to 2021 (according to their data), hiring volumes in Ukraine have decreased by 50-90% depending on the project. At the same time, the company is doing everything possible to avoid reducing staff.
“If one of the projects closes, the specialist may stay “on the bench” for a while until we find a new one. This also applies to those who have decided to go to the frontlines or have been mobilized – their place is preserved. The number of layoffs remains minimal,” shares Andriy Oksenyuk, CFO of Ciklum.
The overall global economic recession also affects the hiring market in Ukraine. A wave of layoffs has hit not only smaller world companies, but also tech giants such as Google, Amazon, Twitter, and Microsoft. Among the reasons are the war in Ukraine, an overheated market after rapid growth in the last two to three years, and the development of artificial intelligence.
“We expect this year to be no less challenging for the industry – its prospects will largely depend on the progress demonstrated by the Armed Forces on the front. However, we believe that the reputation that our tech community has built up over the years working in the global market will be a decisive factor in making decisions in favor of Ukraine,” says Andriy Oksenyuk, CFO of Ciklum.
In the subway, in shelters, under shelling, during breaks between relocation to safe places, with Starlink and under the sound of generators – Ukrainian tech specialists did what they do best during the year of full-scale war: they worked tirelessly, launched new apps and websites, donated and grew. And each tech company not only became […]
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