Kharkiv is a large Ukrainian industrial and innovation center, the second most populous Ukrainian city after Kyiv, and one of the largest IT clusters in Eastern Europe.
According to the Kharkiv IT Research 2019 survey conducted by PricewaterhouseCoopers and the IRS-group, there are 483 product and IT outsourcing companies in Kharkiv employing 31,000 IT professionals (2018 growth of 24%). Looking at IT employment levels, Kharkiv is second only to the Kyiv IT hub. The city has a large number of small and medium-sized IT companies, such as AltexSoft, CodeIT, INSART, as well as outsourcing industry heavyweights, NIX Solutions, ZONE3000, Plarium, Softserve, Sigma Software, EPAM, Infopulse, GlobalLogic, Ciklum.
The Kharkiv IT cluster is extremely diverse, with key specializations including insurance, health care, education, media, and advertising and retail. About 68% of IT professionals are software developers and earn monthly $2025, which is almost 6 times the average income in the Kharkiv region. Among the important reasons for IT pros to locate in Kharkiv are quality education, opportunities for professional growth, rich cultural heritage, developed infrastructure, and favorable working conditions. However, among the weaknesses, there are low standards of intellectual property protection and a lack of training and teaching professionals with experience in IT.
In 2018, Kharkiv IT companies paid UAH 6.4 billion in city and state taxes (~$237 million), of which 45% went to the city treasurer. Under favorable conditions for the industry, tax revenues could triple by 2025, and the Kharkiv IT industry could reach $1.9 billion in annual sales. The main customers of Kharkiv IT businesses are companies from the United States and Europe. North America remains the main export destination, accounting for almost 75% of total sales in 2018. Overall, Ukrainian IT outsourcing has grown by about 30% over the last 10 years.
Kharkiv is an educational center of Ukraine, with five higher education institutions that train qualified IT and technology professionals. The largest number of graduates comes from the Kharkiv National University of Radio Electronics, National Aerospace University and Kharkiv Polytechnic Institute. Specialized IT academies include the Microsoft IT Academy, Oracle IT Academy, and Cisco Academy. There are dozens of IT courses in Kharkiv, such as Hillel, Sigma Software University, SoftServe IT Academy, Skill UP, STEP computer academy, and the Ukrainian IT School. Many comfortable coworking spaces, including Coworking 365, Fabrika.space, and Branch, are also available.
The study of English has become more widespread among Kharkiv residents, which is now a prerequisite for higher education and personal growth. The combination of industry and education creates a wide range of opportunities for companies looking to expand their R&D labs in the region. Large R&D centers by Plarium, Sigma Software, Oracle, Samsung are already operating in the city. Kharkiv is also gaining popularity as a location for startups. Well-known startups such as GitLab, Docsify (a tool for Gmail and G Suite), MyCredit (online credit system), QuickBlox (backend platform for mobile applications), Eventor (mobile guide for conferences) are all located here.
The Kharkiv IT Cluster association brought together representatives of IT companies, city and regional administration, and educational institutions. It counts among its members 73 leading companies and partners with 43 leading institutions. The association works in four main areas: growing the number of quality IT personnel through educational initiatives, developing urban infrastructure, strengthening the image of Kharkiv at the international level, as well as creating additional value for companies participating in the cluster. The cluster offers a variety of educational platforms: Kids2IT, Easy2Start IT Career– an international educational forum.
A large number of industry events are held during the year. Among the largest are the Kharkiv.js and AI Ukraine conferences, which take place alternately in Kharkiv and Kyiv. They bring together hundreds of people interested in the latest innovations in software development and computer science. Other interesting conferences include HR Pro Gym, Kharkiv CSS, Annual Conference on Project Management and Business Analysis, International Cyber Security Forum, Business Analysis Conference, and IT Weekend, founded by SoftServe.
The Kharkiv IT Cluster association also joined the Kharkiv Smart City program, aimed at transforming Kharkiv into the first “smart city” in Ukraine. The team has already selected projects for joint work with the City Reform Office and industry partner Vodafone, a participant in more than 100 “smart” cities around the world. Meanwhile, the DCH Group intends to launch a project of a multifunctional business park called Ecopolis, which will be the largest technology park for high-tech enterprises and companies. Another project, IT Park Manufactura, will add a modern business center to the city.
Provided stable and transparent business conditions, Kharkiv’s role as a key IT region in Eastern Europe will only get more important.