Are you interested in expanding abroad your tech team but not sure where to start? There is no need to worry. People often have a lot of questions when it comes to the topic of growing a company's technological capacity. Which country is the most cost-effective for near- and offshore software engineering? And how wide is the range of opportunities that different countries could offer? And yes, these questions could be the tip of the iceberg. To help you make an informed decision, we will take a detailed look at the latest data about Bulgaria.
We can't overlook the fact that the software development sector continues to grow on a global scale. The 2020 Business Wire Report predicts that IT outsourcing will increase to $410.2 billion by 2027, with a compound annual growth rate of 2.6%. With a range of countries to select from for remote developers, Bulgaria is recognized as one of the most attractive tech destinations in Europe. You may wonder why?
Located in the south-eastern part of Europe on the Balkan Peninsula, Bulgaria is the sixteenth-largest country in Europe, with an estimated population of 6 million citizens. The country is only a flight away from all major European capitals and its strategic location is highly valued in every aspect, enabling local companies to collaborate with teams from around the world efficiently.
According to the Тech Cities of the Future 2020/21 ranking, the Bulgarian capital city – Sofia, is ranked 20th out of 76 cities with indicators including attracting investments, qualified workers and developed infrastructure. Out of the Balkan cities, Sofia is in 7th position and comes immediately after Moscow (the chart was released prior to Russia’s aggression in Ukraine and any subsequent restrictions imposed on Russia) and Helsinki, and is ahead of Milan, Prague and Tallinn.
Stable economic environment
Bulgaria has a robust economy, with strong public finances and low debt levels. Before the Covid-19 pandemic situation, the country experienced economic growth and low unemployment rates. In 2020, the Covid-19 crisis inevitably affected the Bulgarian economy, but in 2021, the country started to recover. According to the annual Harmonised Indices of Consumer Prices, inflation is set to come down from 12.8% in 2022 to 7.4% in 2023 and then settle at 3.2% in 2024. With inflation gradually slowing down, GDP growth is projected to accelerate from 1.1% in 2023 to 2.4% in 2024.
The Bulgarian IT sector has been among the driving forces behind the countries steady growth over the past few years. With an average annual increase of 17% since 2007, the ICT sector is one of the economy's fastest growing sectors. The industry generated 20.2% growth and reached a share of 4.3% of the Bulgarian GDP.
Highly educated & skilled professionals
Bulgaria’s educational system is well-developed, offering a vast network of secondary schools with an intensive focus on languages, mathematics and science.
According to a 2016-research by Hacker Rank, Bulgaria is among the countries with the top performing software developers. It ranks 12th worldwide and 8th in Europe. Furthermore, the country occupies 2nd and 3rd place for the best Java and Python developers respectively. The skills of the Bulgarian software developers are also recognized in the “Where to find the best developers in 2021” report by SkillValue. Bulgaria ranks 12th in the global chart, and the capital city Sofia takes the 8th position in Europe. In the 2022 report, the capital city occupied the 6th position in the global ranking.
Size of the talent pool
The majority of the so-called “white collar” employees work in the capital city of Sofia and the other big cities in the country – Plovdiv, Varna and Burgas. According to Statista, the number of Bulgarian software developers has been steadily growing by an average of 7% yearly for the last decade. Currently, the IT sector consists of approximately 84,000 full-time employees (excluding freelancing professionals), according to the National Social Security Institute (NSSI).
In terms of gender diversity, Bulgaria has an outstanding performance as well. In 2022, 45.9% of Bulgaria’s workforce were women, according to the World Bank, while the average share globally was 39.2%. Furthermore, the country has the highest share of women employed in the ICT sector in Europe. In 2021, it was 28.2% (Eurostat), while the average for the European Union was just 19.1%. From this perspective, Bulgaria becomes a great destination for tech projects standing for gender equity.
Keen to further explore the strengths of the Bulgarian IT sector or get an overview of the labour costs, read our latest IT Industry Report or check out few examples of companies that have already successfully expanded to Bulgaria.