Before the full-scale invasion, Lviv was one of the largest Ukraine’s tech hubs, alongside Kyiv and Kharkiv. Since February 24, 2022, the city has also become the relocation center for Ukrainians, particularly for the tech business. Today, Lviv ranks second in terms of the number of specialists involved in the tech industry and the direct economic effect of the tech industry, adjusted for migration.
According to the latest tech industry study IT Research Ukraine, currently, there are 599 tech companies in Lviv and the region. Over the past 7 years, their number has increased from 192 in 2015, to 599 in 2023. In general, 28% of Ukrainian tech companies have offices in Lviv and the region.
Service tech companies are predominant in Lviv. SoftServe, Intellias, ELEKS, and others were founded and have headquarters here. About 40% of the employees of Lviv region relocated to Lviv from other regions. The city attracts with its comfortable living conditions, affordable prices and ancient architecture.
In 2023, 15 Ukrainian tech companies were enlisted in the IAOP Global Outsourcing 100, ranking the world’s best development, outsourcing, and consulting service providers. 7 of these companies are members of the Lviv IT Cluster. 22 companies in the TOP 50 largest IT companies ranking by DOU are members of the Lviv IT Cluster, and 28 companies have offices in Lviv.
Since the beginning of the full-scale invasion, Lviv has become a haven for internally displaced people and businesses. At that time, 245 thousand IDPs have officially registered in the Lviv region. Lviv IT Cluster, together with its member companies, has equipped 7 IDP centers with 1 200 beds, provided shelters in schools and kindergartens with Internet access so that parents can always stay in touch with their children, and opened a Mental Health Centers for kids and adults where all those affected by the war can receive professional help.
Since February 2022, the Lviv IT Cluster, together with the business association members, has been focusing on projects that bring Ukraine’s victory closer and strengthen security and stability in the Western region.
Lviv is a relatively safe city for opening new offices and representative offices of companies. The overall economic impact of the tech industry in Lviv and the region has continued to grow over the past three years, according to IT Research: from $1,4 billion in 2020 to $1,8 billion in 2021. In 2022, it crossed the $2 billion mark, representing a +10% growth.
The increase in tax revenues from tech companies in the Lviv region in 2022 was 27,4% higher than in 2021. The total tax payments by for 2022 amounted to $59,45 million, and in the first half of 2023 – $34,55 million. In 2023, despite operating under the conditions of the second year of full-scale invasion, Ukraine’s tech industry generated $6,7 billion in revenues. Thus, computer services constitute 41% of the total volume of service exports in Ukraine.
In 2023, there were more than 51 thousand experienced tech specialists in the city and region. Most of them, namely 41%, have a Senior qualification level. There are 19 bachelor’s degree programs in 4 universities in Lviv, updated by the Lviv IT Cluster in cooperation with tech companies and education representatives. Within these programs, 4,500 students receive up-to-date knowledge as well as valuable practical skills for work in all areas of tech: from cybersecurity and artificial intelligence to HR and IT Sales.
Despite the ongoing war, the tech industry demonstrates high level of resilience and remains the one of the key spheres of Ukraine’s economy. Ukrainian companies have been working for the second consecutive year in conditions not only of a global crisis and recession but also of a full-scale war. Despite this, the tech industry continues to contribute a significant amount of foreign currency inflows to Ukraine. In the past year, 2023, the export of tech services brought $6,7 billion in foreign currency revenues to the Ukrainian economy.
Lviv is the tech center of Ukraine, which is closest to the EU borders. The city attracts young people, professionals, and foreign investors. International conferences are held in Lviv, including one of the most ambitious projects of the Lviv IT Cluster – the IT Arena conference. Every year, IT Arena is attended by more than 5,000 experts from more than 40 countries: developers, managers, investors, and journalists.
Dozens of startups are being created in Lviv, thanks to a strong emphasis on tech education. In the city, the startup ecosystem is actively developing, particularly due to the close collaboration between universities and tech companies. Lviv universities actively cooperate with foreign universities for student exchanges and internships. International companies are also increasingly choosing Lviv as a location for their offices. 20% of global companies have offices in Ukraine, and 110 international corporations have opened R&D centers here. In 2022, Lviv IT Cluster launched the Lviv Tech B2B platform, which helps international businesses connect with the active tech community of Lviv and the region for potential partnerships.
Ukraine continues to hold high positions in global rankings. In 2023, according to the Global Skill Report 2023 by Coursera, Ukraine ranks 15th in the world for the level of professional skills in business, technology, and data science, marking a +6 position improvement from the 2022 results.
The professional community in Lviv is growing partly due to a large number of educational institutions. Among the leading universities in Lviv for a tech degree are the Ivan Franko National University of Lviv, Lviv Polytechnic National University, Ukrainian Catholic University, etc.
As part of the Lviv IT Cluster’s educational initiatives, there are 19 programs in four universities in the city: Ivan Franko National University of Lviv, Lviv Polytechnic National University, Lviv State University of Life Safety, and Lviv National Academy of Arts. About 1,000 tech students graduate from the education programs updated by the Lviv IT Cluster each year.
The dynamic development of the tech environment makes Lviv an attractive center for investment, work, and study. No wonder international companies with a world name trust local experts, which certainly has a positive economic effect on the city.
The number of jobs created thanks to the tech sector is also impressive. On average, one tech company in Lviv and the region creates and sustains 3,1 jobs by hiring one industry specialist. In 2020, the total number of jobs created by the local tech industry was 74,000, and by 2022, it had increased to 122-124,000 jobs. Despite all challenges, in 2023, the city managed to maintain a positive image and create a secure business climate for potential companies and investors.
Lviv IT Cluster, together with business association members, has created a number of Victory projects to bring Ukraine’s victory closer, as well as to strengthen security and stability in the Western region. Among them are Sky, Vision, Armor, Second Home, a project to provide the western region of Ukraine with backup Internet access, and a Mental Health Center as part of the initiative to build the National Rehabilitation Center “Unbreakable.”
