A highly educated workforce and low cost of labor made Ukraine an attractive outsourcing tech hub for Fortune 500 firms, churning out more than 200,000 IT workers.
But these days, Andrew Pavliv, the founder and CEO of N-iX, one of Ukraine’s largest tech companies, is more consumed with managing the flow of employees within his own country. Since the Russian invasion began last month, Pavliv’s firm has evacuated nearly 200 employees from hard hit cities in eastern Ukraine, including Kharkiv to the relative safety of N-iX’s office in Lviv, along the Polish border. Twenty-two of the company’s specialists have left their jobs temporarily, to fight for the Ukrainian military.
“It was really hard days since the beginning of the war … there were interruptions in the services because people were moving with their families. They were finding places here, where to stay,” Pavliv said. “Last week, we checked our service delivery capabilities. And for some of the clients, we even did deliver 100% of services. For some of our clients, we delivered about 80% to 85% of services.”
The fighting in Ukraine has put a spotlight on the country’s budding IT sector, and its increasing importance to the global tech supply chain. Boasting some of the nation’s highest salaries, the sector contributed roughly 4% to Ukraine’s GDP last year, with exports crossing the $5 billion mark for the first time in 2020.
For Western firms, those services have proven to be a valuable lifeline as they make the rapid transition to digital. Ukrainian computer code can be found in some of the world’s largest banks, including JPMorgan Chase (JPM), aerospace manufacturers like Boeing (BA), and carmakers Daimler and BMW. Apple (AAPL) and Alphabet (GOOG) have maintained a presence in Ukraine to tap into the country’s growing tech talent.
“[Ukranians] are very creative, I would say. So when you need complicated software developments, go to Ukraine. I think this was a factor, in the industry growing 40% to 50% a year,” Pavliv said. “The IT profession here is very popular among the young people, so a lot of universities are growing their faculties for technical professionals.”
N-iX has been providing software development services since 2002, partnering with companies all over the world. The company has expanded its presence outside of Ukraine, with offices in Poland, Sweden, Bulgaria, and the U.S.
Pavliv said the constant threat of Russian military attacks have made it difficult to separate work from war, even as his employees work around the clock to provide services without disruption. Last week, a company director managed to hop on a call with a U.S. client, after running out of fuel as he attempted to evacuate from Kyiv. The firm has lost employees who have left to volunteer for the Ukrainian military, though they continue to provide financial support.
Pavliv has delegated much of the firm’s operations to the roughly 1,500 employees now operating out of western Ukraine, largely isolated from the fighting. But he remains wary of the impact the war will have on his company, the longer the attacks continue.
He said many of his international clients have largely been understanding of any service delays, and pitched in with huge donations to help the country. But he is also bracing for the worst, sourcing buses for female employees looking to cross the border, and work out of Poland instead.
“We think the situation will be like that for the future, like for the next month … a few months,” he said.
Akiko Fujita is an anchor and reporter for Yahoo Finance. Follow her on Twitter @AkikoFujita
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