The crisis in IT: Recruiters are no longer the first to write, and the number of responses to a vacancy is seven times higher than the offer.
The Ukrainian IT sector is experiencing the biggest crisis in recent years. Business Censor analyzed the causes and consequences.
The number of vacancies on the Ukrainian IT market fell to the level of 2019 in the summer. At the same time, the number of responses to them is seven times higher than the number of offers.
This follows from the graph of the dynamics of the number of vacancies in the Ukrainian IT market and the number of responses to them since 2018, published by Djinni. This is one of the largest job search sites for IT professionals.
Five years ago, recruiters wrote to IT professionals 5 times more often than candidates. Now it is exactly the opposite.
“At the beginning of 2018, the Djinni index was almost 7, but with the growth in the number of vacancies, it quickly dropped to a “comfortable” 3-3.5 in April-November 2019. This was followed by a “covid dip,” and in April-November 2021, the index returned to 3.5. After the start of the full-scale invasion, in March 2022, the index was already 0.88, meaning that for every 100 responses to vacancies, candidates received 88 offers. As of mid-August, it is already 0.18 on average across all categories,” the portal notes.
Active dismissal of engineers
In the first half of 2023, the number of employees in the 50 largest IT companies in Ukraine decreased by 6100 people, or 6.6% to 86.3 thousand, according to the DOU portal.
At the same time, the largest reductions were in the largest companies – as of July 2023, the top 25 IT companies in Ukraine employed 67.4 thousand people, or 5.7 thousand fewer than in winter.
First of all, the layoffs affected technical specialists. In the 25 largest IT companies in Ukraine, 5100 people were laid off (or mobilized or resigned) in the first six months of 2023.
The active reduction of working brains in the Ukrainian IT market is due to several factors. The first is the global IT crisis, which is accompanied by layoffs of IT professionals around the world.
The next factor is Russia’s war against Ukraine, as international clients are less active in placing new projects with us due to security risks.
The third is the insufficient pace of booking IT specialists from mobilization – only 1.4% of specialists in the top 50 IT companies, or 1.2 thousand specialists out of 86.3 thousand, have been booked.
The situation is slightly better for food companies, according to DOU. Eight Ukrainian companies that sell their own IT products rather than code have maintained positive growth dynamics. It was product companies that accounted for half of all hires in the top 50 over six months.
Salaries are still in place
A survey of Ukrainian developers shows that the median salary has remained virtually unchanged for almost a year. However, there is a tendency to decrease the salaries of the highest paid specialists and senior developers.
At the same time, there is a certain increase in compensation for non-technical specialists
According to the DOU survey, the median salary of the Director of Engineering increased by $800, and the salaries of the most experienced project management specialists increased by $400 in the first half of the year.
Salaries for System Analysts and Data Science continue to grow. Marketing also saw a slight increase in salaries (by $110 on average for all positions).
The downward trend in Ukrainian IT exports
The volume of foreign currency inflows from IT exports is also decreasing.
Over six months, the export of IT services from Ukraine decreased by 9.3% compared to the same period last year and amounted to $3.38 billion.
In the first quarter of this year, exports of IT services from Ukraine decreased by 16% compared to the same period in 2022 and amounted to $1.68 billion.
At the same time, in 2022, the IT industry provided record foreign exchange earnings to the Ukrainian economy of $7.34 billion. Exports increased by $400 million compared to the pre-war year of 2021.
Tags: Tech Ukraine
