Despite this, the World Economic Forum’s latest Chief Economists Outlook reflects increased optimism that conditions in Europe are set to improve, with the majority view expecting moderate or better growth in 2025.
A survey of our own outsourcing network in Eastern Europe bears this out, with software development firms indicating plans to increase headcount by 6-10% in the next year. The message from our partners in this resilient region is that they’re open for business and continuing to take on new clients.
All of the firms we work with in Ukraine have moved their teams into neighboring countries or to safer locations in the west. This flow of cross-border migration has led to new metropolitan areas emerging as tech hotspots.
Europe’s highly educated, quality workforce, good English skills and cultural alignment remain strong factors in its favor. Sharing a single passport and currency is another major advantage, creating more flexibility in the software ecosystem.
Our 2024 Europe, Africa, and the Middle East Guide to Software Outsourcing draws on international data and expert insights to analyze 18 countries and their potential for offshore partnerships, from well-established tech hubs in the Balkans to new emerging markets.
When you’re considering candidates for your next development project, here’s why these regions should be on your shortlist:
| Reduced development expenses | Cost savings of up to 30% compared to North American developer rates allow budget maximization without a trade-off in quality. |
| Top-tier talent | Access to a highly creative and skilled workforce, with large pools of experienced engineers proficient in AI, cybersecurity, mobile apps, and more, supported by a strong educational focus on science, technology and engineering. |
| Seamless communication | Finding and interviewing candidates, negotiating compensation, and onboarding a new employee takes time – only for some to leave a year or two later for a new opportunity. Working with an outsourcing partner allows you to delegate a lot of the recruitment process, enabling tech leaders to allocate time and energy to more high-value initiatives for the company. |
| Workday overlap | U.S. teams benefit from a time-zone advantage when working with partners across Europe, the Middle East, and Africa due to the part-workday overlap and potential for rolling shifts, enabling faster turnaround and real-time collaboration. |
| Industry strength | Political and economic ties with the European Union bolster government support for the IT sector, from investment in vital infrastructure to the development of technological expertise. |
Three European countries stand out for their depth of experienced talent, diverse skills, and familiarity with Western clients. This year, we also welcomed our first software development partner from South Africa.
As we race towards a new year, the software development market is poised for yet more growth and innovation. Our exclusive 2025 Global Software Outsourcing Rates and Trends Guide is an invaluable resource, featuring a comprehensive analysis of the past 12 months and research-driven insights into what lies ahead.
Across all our key outsourcing regions, the embrace of artificial intelligence is already having a profound impact.
Uncertain times may still lie ahead for Eastern Europe. However, with its established track record for offering expertise in highly specialized, high-value areas of software development, the region is poised to make the most of the AI boom.