Lvov IT Cluster expects Ukraine’s exports of IT services to drop 4%-6% in 2024
Exports of IT services are expected to decrease 4%-6% to $6.3 billion-$6.4 billion in 2024 year-on-year, Lvov IT Cluster said.
“The decline in IT service exports which began in 2023 is continuing. Even with an optimistic scenario, it will decrease by at least 4% at the end of 2024 compared to 2023. With a pessimistic one, this indicator will reach 6%. That is, in the end, we should expect $6.3 billion-$6.4 billion. Therefore, in 2024, for the second year in a row, the technology industry will not show growth compared to past year,” Ukrainian media cited the cluster’s IT Research Ukraine 2024 study as saying.
Nevertheless, despite the challenges posed by the crisis, the technology industry remains one of the key sectors in the Ukrainian economy and provides significant foreign currency earnings, the study findings show. The IT sector is Ukraine’s largest exporter of services, accounting for 38% of all service exports. It ranks second in the overall structure of Ukrainian exports, preceded only by food exports, according to the findings.
Currently, there are 2,118 active verified tech companies in Ukraine. About half of them are service-oriented, with 47% focused on outsourcing and 3% on outstaffing. Another 31% are product-based companies, while the rest use a mixed business model.
As many as 45.7% of representatives from IT companies polled by Lvov IT Cluster said they are not going to open new branches in the short term, 17.1% announced plans to expand in Ukraine, and 34.3% abroad. The top location choice is Poland. Meanwhile, 6% of the CEOs who took part in the study said they plan to close their offices in Ukraine.
The number of specialists employed in Ukraine’s IT sector has dropped 1.6% to 302,000 this year. Of them, 238,000 live and work in Ukraine. The number of Ukrainian specialists abroad has also decreased to 62,000-64,000 versus 65,000 in 2023, according to the findings. The average age of IT specialists is 31.5 years.
According to IT Research Ukraine 2024, the median income of a tech specialist in Ukraine fell 1.7% to $2,590 in 2024 year-on-year. At the same time, most respondents said that the portion of their income that goes toward rent, groceries and other basic needs has grown.
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