Ukrainian IT Market in Its Most Challenging Period in Recent Years
The IT industry in Ukraine, which was previously one of the most dynamically growing sectors of the economy, is currently experiencing its most difficult times in recent years. In January 2025, IT service exports amounted to only 489 million dollars, which is 19 million dollars less compared to the same period last year. This marks the worst start to the new year since the onset of the large-scale war and has raised concerns among experts and industry representatives.
This is reported by AgroReview
Causes of the Crisis in the Ukrainian IT Market
According to analysts, the Ukrainian IT sector, which demonstrated an average annual growth rate of 14.7% from 2017 to 2019, is now facing stagnation and a slowdown in development. The main factors affecting the situation include military risks, a decrease in the number of orders, and project freezes due to economic turbulence and uncertainty in the country.
The number of companies in the sector decreased by 25% in 2022 and has yet to reach the levels of 2021. Nearly half of the experts note that the market is experiencing stagnation. They point to a decline in the number of orders, military risks, as well as restrictions in contract execution, even with uninterrupted communication, relocation, and backup offices. According to surveys, 58% of companies faced contract terminations, and 25% suffered losses exceeding 40% of their revenue.
Impact of the Crisis on the Labor Market and Salary Levels
The crisis phenomena have significantly affected the labor market in the IT sector. The Ukrainian market has transformed into an employer’s market, but with a high level of risks and a decrease in the number of orders. This has led to a reduction in salaries: 68.2% of experts believe that salaries in the sector will not rise in the near future, and more than half of the experts predict that the decline in income will continue for another one to three years after the war ends.
Thus, the Ukrainian IT sector, which was once one of the pillars of the country’s economy, is facing serious challenges due to military aggression and economic instability, which significantly impacts its future and positions in the global market.