Offshore Staff Augmentation: Top Outsourcing Countries

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Julia Sakovich
Author, Geomotiv
Published: Sep 2, 2021

Some decades ago, outsourcing development was something new and unusual as most companies used to have their software development department. Today the situation completely differs from what we have even at the beginning of this century. The outsourcing market has become relatively mature, and various forms of collaboration with software partners have come into the game: offshore staff augmentation, dedicated and managed teams.

But what are the best countries to outsource software development? Where should you look for when you want to hire the most talented experts for our project? This article will enumerate the top outsourcing countries in the world and explain why they are ranked high on this list.

Why is Offshore Outsourcing Gaining Momentum?

First, just a quick reminder for you of the benefits that outsourcing in any of its forms has in comparison to in-house software development. Working with external developers, you can:

  • Cut off the development costs
  • Avoid hiring routine and numerous issues related to administrative processes
  • Get access to a significantly wider talent pool
  • Ensure flexibility of your business
  • Have more time and resources to focus on your core activities.

Given these new possibilities, nothing is surprising in the popularity of outsourcing. But why namely, the offshore type, not onshore or nearshore, preferable for many businesses of all sizes and types, including small ones, across the US and Europe?

Where Do Small Businesses Plan to Outsource?
Source: https://clutch.co/bpo/resources/benefits-of-outsourcing

The explanation is hidden behind numerous factors. However, excellent development skills in combination with reasonable rates are probably the key ones. As a result, companies can significantly reduce their expenses on salaries without losing the quality of the work done (or maybe even increasing it).

Furthermore, though the cultural differences can be obvious, good developers, who have experience in cooperation with clients from overseas, are usually very flexible and are ready to adapt to some issues related to this aspect. Moreover, the excellent command of English that many software experts have today helps to overcome any language barriers making the communication pleasant and straightforward.

As for the time differences, it can be somewhat tangible if, for example, you are based in the US. At the same time, your developers work from Belarus or Ukraine, or any Eastern European country. But at the same time, there is the possibility to ensure 24-hour productivity thanks to introducing day and night shifts.

Let’s try to summarize what we’ve just explained above.

Why do US and European companies often opt for offshore developers?

  • Reasonable rates
  • Excellent technical skills
  • Availability of experts working with different technologies and tools
  • High level of IT education
  • Experience in working with a rich tech stack
  • High quality of software solutions
  • Ability to work in cross-cultural teams
  • Soft skills
  • Good command of English.

If you want to read more about the peculiarities of onshore, nearshore, and offshore outsourcing, we offer to read one of our previously published blog posts where we took a closer look at these cooperation models.

Top IT Outsourcing Countries Today

Main criteria for choosing the best countries for outsourcing:

  • Number of developers and business expertise;
  • English language skills;
  • Availability of relevant qualifications and skills;
  • The country’s software development rating;
  • Cost;
  • Time zone differences.

Number of developers and business expertise

How large is the tech talent pool, and how many businesses operate in each outsourcing destination? When choosing the right project team, these are essential issues, as it helps determine the most favorable conditions to outsource software development. 

The more mature the market in the country is, the fewer risks of disservice may occur. The same applies to the size of the talent pool in each country, especially when you need to hire many experts or access specialized skills for the project.

As for Eastern European countries, they have a talent pool of nearly one million professional software developers. Again, Russia employs the most software developers, with Ukraine and Poland rounding up the list of top 3 countries in the region. 

The region houses more than 2500 software development vendors registered on Clutch alone. It is worth mentioning that practically all of them have delivery centers there, thus hiring local talent and using their expertise and skills.

Transcaucasian’s ICT market comprises up to 20,000 employees in Armenia and a STEM-related graduate output of 3,000 annually in Georgia. 

Since 2019, Armenia has rolled an active support program for the ICT sector, which increased the number of development centers, mainly operated by US-based companies. Still, the country faces a couple of issues related to transparency in tax and customs procedures, according to the official website of the International Trade Administration.

As for Georgia, its government started to support foreign IT companies by providing low taxes and labor costs, which attracted many players, mainly from neighboring countries.

The Asian labor market engaged in the ICT sector is one of the largest in the world. China and India have the most significant number of software developers as there is a high rate of students graduating each year. As per recent estimates, the Philippines are third in the region, housing more than 200,000 tech specialists.  

It is no secret that Asia is home to the most funded industry unicorns, which constantly fuels the development of digital technologies. However, it is worth noting that the internal demand for IT-related graduates is very high. They are primarily engaged in government-led projects or in-state companies.

The combined tech talent pool in LATAM countries exceeds one million developers, with the majority living and working in Brazil. Argentina, Mexico, and Chile occupy the consecutive positions on the list.

CountryNumber of developers
Brazil431,000
Mexico180,000
Argentina100,000
Colombia55,000
Chile58,000

According to Clutch, there are 1957 companies in LATAM, but the majority of them don't have local delivery centers there.

Top countries for outsourcing by the number of developers and business expertise:

Eastern Europe: Russia, Poland, Ukraine;

Transcaucasia: Georgia, Armenia;

Asia: China, India, the Philippines;

Latin America: Brazil, Mexico, Argentina.

English language skills

If you are outsourcing your critical tasks, good command of English is a pure necessity. Working with remote projects requires a lot of active communication between architects, developers, designers, project managers, and other team members. Most regions and countries that offer software outsourcing services don’t have a language barrier, even though their developers may not sound like native speakers. Most software outsourcing developers have a comprehensible accent that doesn’t affect written and verbal communication. 

One good way to evaluate the English skills of each outsourcing country is to analyze the data presented on the English Proficiency Index website. Here’s what we found:

  • The majority of Eastern European countries have a conventionally high and moderate level of English proficiency;
  • We can also observe that Argentina, the Philippines, and China are on this part of the list as well;
  • It is worth noting that the Philippines have a better command of English than other Asia-based countries. India, for instance, is in 50th place, while China occupies 38th position;
  • Brazil occupies the 10th position in Latin America. It makes it a bit harder for employers to find the right talent with good English proficiency.
Global Ranking of English

Top countries for outsourcing by English proficiency level:

Eastern Europe: Russia, Poland, Belarus;

Transcaucasia: Georgia, Armenia;

Asia: The Philippines, China;

Latin America: Argentina.

Availability of relevant qualifications and skills

For businesses looking to outsource their projects, a high-quality educational infrastructure is a must. The best countries to outsource software development are the ones that focus on providing quality specialists with a STEM degree, IT-related studies, and knowledge of business processes. It is also important to assess the availability of free and paid courses that help to advance basic technical skills. 

Taking this into account, we can mention that Eastern European countries have diverse math and science programs and provide skilled IT graduates every year. Having inherited a well-known legacy of the Soviet Union’s educational system, the region remains one of the most technically advanced ones in the world.

As for Asia, QS World University Rankings lists 186 computer science and Information technology universities. The most reputed ones are located in China and India.

Transcaucasia’s Georgia and Armenia have several good university programs to study computer science and IT. However, the demand for qualified professionals grows faster than its supply according to recent estimates. 

Graduates with ICT-related university degrees in Latin America have fewer options with their learning paths than in Asia or Eastern Europe. The above-mentioned QS World University Rankings include 30 HEI in the region. Here’s a glance at their location.

CountryNumber of universities
Brazil13
Chile5
Mexico5
Colombia4
Argentina2
Peru1

Top countries for outsourcing by the availability of relevant qualifications:

Eastern Europe: Russia, Belarus, Ukraine FSU countries;

Transcaucasia: Georgia, Armenia;

Asia: India, China;

Latin America: Brazil.

The country’s software development rating

While choosing the top outsourcing hub, it might be useful to consider the rating of developers from this country. At the time of writing this article, Russia is at the first spot on the Top software outsourcing countries globally, according to the TopCoder data. Other countries that also made it to the list include five representatives of the Eastern European region (Poland, Belarus, Ukraine, Bulgaria, and Romania), China, Argentina, Brazil, and Peru. 

In addition, China, Russia, and Poland lead the pack as the top three winners of the so-called “coding Olympics”, completing all of the tasks supplied by HackerRank

Top countries for outsourcing by tech proficiency:

Eastern Europe: Russia, Belarus, Ukraine, Poland;

Asia: India, China;

Latin America: Argentina, Brazil.

Cost

Many North America and Western Europe companies need to address a similar challenge of choosing the right outsourcing destination that will fit the budget limitations. On the other hand, most outsourcing companies from reputed locations have lower rates than in the US or UK due to lower compensations, overheads, and costs of living.  

It is important to get an optimal quality-price ratio when considering the best outsourcing country or region. Sometimes companies opt for regions with low rates but end up paying above-average to fix issues in low-quality software. This is just one of the criteria for evaluating a particular country in terms of its attractiveness as an outsourcing destination. Based on the data collected by Payscale and Glassdoor, average software developer’s rates in the world’s renowned outsourcing hubs look in the following way.

RegionCountryAverage rate range
Eastern EuropeBulgaria$40-55
Ukraine$35-60
Poland$45-70
Belarus$35-49
Russia$29-50
AsiaIndia$20-40
Philippines$20-40
China$20-40
TranscaucasiaGeorgia$30-45
Armenia$35-50
Latin AmericaBrazil$35-70
Argentina$35-70

Top countries for outsourcing by cost-efficiency:

Eastern Europe: Russia, Belarus, Ukraine;

Transcaucasia: Georgia, Armenia;

Asia: India, China, the Philippines;

Latin America: Argentina, Brazil.

Time zone differences

In theory, working with a remote outsourcing company brings the trouble of finding suitable working hours that will satisfy each party. It is necessary to ensure that business hours overlap and don’t hurdle communication. However, having a reliable team by your side ensures that lack of time zone proximity doesn’t affect operations. For example, they usually strive to compensate for that gap by providing support and maintenance services before and after business hours.

Indeed, a good understanding of how much working hours will overlap with your remote team can help choose the right outsourcing country. A popular outsourcing destination like Beijing (China) is one of the most distant hubs in terms of geography, being 12 hours ahead of New York. Here’s how the same comparison applies to other outsourcing countries, by region.

RegionCountryTime zone gap
Eastern EuropeBulgaria7 hours
Ukraine7 hours
Poland6 hours
Belarus7 hours
Russia (Moscow)7 hours
AsiaIndia12 hours
Philippines12 hours
China12 hours
TranscaucasiaGeorgia8 hours
Armenia8 hours
Latin AmericaMexico1 hour
Brazil1 hour
Argentina1 hour
Colombia1 hour

Due to a favorable geographic position and negligible time difference, the countries from Latin America look attractive as a nearshoring destination. However, it is worth assessing them on other criteria listed above to ensure they are the best fit for the particular project requirements.

Summing up: The Best IT outsourcing countries

Ukraine

Number of developers200,000
Number of IT companies 874
English Proficiency Moderate (44th place)
Tech rating11th place by HackerRank;
7th place by TopCoder
Famous software productsGrammarly, V-touch, Looksery,
Petcube, People.ai
Time zone(GMT+3)
Average hourly rate$$35-60

The IT services market of the country entered 2021 with a market growth rate of 20%. Today the country has over 200,000 tech specialists working with different tools and technologies. The number of IT-related businesses is growing as well.

During the strict coronavirus lockdown implemented by the local authorities in 2020, over 90% of software development companies switched to remote work, which means that today Ukrainian IT specialists are accustomed to this work model. Despite the lack of strong governmental support of the IT sector, it is actively developing thanks to the talents and skills of its experts.

Belarus

Number of developers55.000
Number of IT companies232
Number of ICT graduates, annually5,000
Number of STEM graduates, annually19,000
English ProficiencyModerate, #40 in the world
Tech rating#6 by TopCoder
Tech specializationPython, PHP, Java, C#, JavaScript
Famous software productsWorld of Tanks, Flo Health,
Masquerade, PandaDoc
Time zoneGMT+3
Government supportStrong; High-Tech Park Belarus

Belarus is another country known for its high IT education and seasoned developers who are good at programming and English. In many IT companies in the country, the B1 English proficiency level is necessary for hiring an IT specialist. As well as in Ukraine, the time zone of Belarus lets developers be relatively flexible, primarily when they work with customers from Western Europe. But even when a customer or a management team is based in the US, it is possible to find a convenient time for both parties to conduct meetings.

Though the IT market in Belarus is significantly smaller than in Ukraine, let’s not forget about the countries’ sizes. Belarusian developers are known to be hard-working, well-disciplined, and open to new challenges.

Russia

Number of developers410,000
Number of IT companies215+
English ProficiencyModerate, #41 in the world
Tech rating#1 by TopCoder, #2 by HackerRank
Tech specialization.NET, Java, C/C#
Famous software productsKaspersky Antivirus, Acronis TrueImage,
ABBYY FineReader
Largest Internet companiesYandex, Mail.ru Group, Avito, Wildberries
Time zoneGMT+3 (Moscow)

Russia has also gained a reputation as a good place for looking for remote developers. Good command of English, excellent technical skills, readiness to work - all this makes Russian developers good candidates. Specialists here are very result-oriented, which helps them to cope even with the most challenging tasks. But there is one issue that you should consider seriously if your developers in Russia will be based in different regions. As the country is vast, it has 11 time zones. So, you should make sure that all your specialists will be able to communicate efficiently.

Armenia

Number of developers20,000
Number of IT companies45+
English ProficiencyLow, #51 in the world
High-Tech associationsEnterprise Incubator Foundation,
Viasphere Technopark
Time zoneUTC+4 (AMT)

Armenia may seem to be not a very obvious name for some people in the best countries in software development. But it is so. Good tech education combined with attention to detail and a sincere desire to constantly expand their knowledge - that’s how we can characterize Armenian developers. Based on our own experience, we can say that the level of English proficiency that guys in Armenia have is the highest one among all other countries that we closely work with. The country is located in the UTC+4 (AMT) time zone, making it possible to find time for meetings even when customers are located in Europe. The rates, as well as in three previously mentioned countries, looked quite attractive for offshore clients.

Georgia

Number of STEM graduates, annually3,000
English ProficiencyModerate, #47 in the world
Tech ratingN/A
Tech specializationJava, Python, JavaScript, Blockchain
Ease of registering a company#2 in the world
Time zoneGMT+4

Georgia has a fast-growing IT market that foreign investors actively support. The country is known for its excellent developers, deep knowledge, and rich practical skills. The time zone may not be the most appropriate one for customers from abroad. However, it is still possible to organize successful cooperation with the guys from this country. At Geomotiv, we are just starting our work with developers from Georgia, but we are pretty satisfied with this experience.

India

Number of developers5 million
Number of IT companies3,210
Number of technical universities23
Number of IT graduates120,000
English ProficiencyLow, 50th in the world
Tech rating31st place by HackerRank;
10th place by TopCoder
Time zoneGMT+5:30

India is one of the most prominent destinations for outsourcing software development services in the world. The country has over 5 million programmers with different specializations. And every year, around 120,000 young programmers graduate from universities. The rates of developers in this country are lower than in Eastern Europe. The main obstacle mentioned, especially for customers from Europe, is the difference in time zone. Sometimes cultural peculiarities are named among the issues in such cooperation. However, if all participants of the projects are, first, good professionals, it is possible to overcome the difficulties caused by cultural norms.

China

Number of developers590,000
Number of GitHub accounts183,805 (#2 in the world)
Number of STEM graduates (2019)50,000
English ProficiencyModerate, 38th in the world
Tech rating#1 by HackerRank, #4 by TopCoder
Tech specializationPython, Shell, Big Data
Time zoneGMT+8

The Chinese IT outsourcing market is on the rise, accelerating by 30% every year. The country emphasizes STEM education and has the highest scores in terms of the technical excellence of its specialists. It receives strong support from the government, which has introduced new policies regulating the industry. However, when it comes to bottlenecks, experts identify data security threats that tend to have a higher probability than in other Asian countries.

Brazil and Argentina

CriteriaBrazilArgentina
Number of developers430,000100,000+
Number of IT companies220+320+
English ProficiencyLow, #53 in the worldHigh, #25 in the world
Tech rating#38 by HackerRank#39 by HackerRank
Number of GitHub accounts81,00014,000+
IT industry associations*Brazilian Association of Software Companies – ABES
*Brazilian Association of Information and Communication Technology Companies – Brasscom
*Brazilian Electrical and Electronics Industry Association – Abinee
*GSMA (Groupe Spécial Mobile Association)
*Argentine Chamber of Software and IT Services Companies (CESSI)
Time zone(GMT-3)(GMT-3)

These two countries are leaders of the software development industry in South America. It’s interesting to note that they are sometimes called the India of the region as they also offer access to numerous talented tech experts and reliable companies providing outsourcing development services. Over 400,000 and over 100,000 developers work in Brazil and Argentina, respectively. The rates in Brazil are higher than in Argentina (actually, Argentina offers the lowest rates in the region). Development teams from Argentina often become a preferable option for customers in the US as there are no significant time differences and language barriers. As for Brazil, there is a critical disadvantage of working with this country as most developers do not speak English.

All these countries deserve to be on the list of top IT outsourcing countries, but as it is logical, they all have pros and cons. And it is better to decide which region to choose after analyzing all the related factors, including your location, budget, and expectations.

Share the requirements of your project, and we can find the best developers for you with the most appropriate skills!

Top 3 Reasons Why Geomotiv Can Become Your Reliable Software Development Partner

  1. More than ten years of experience and knowledge accumulated to feel the industry and foresee its demands.
  2. We have access to 5000+ best developers. This vast talent pool allows us to find specialists even with the rarest combination of skills easily.
  3. We have solid expertise in various industries and business domains, including the most quickly developing ones, such as edtech, adtech, eCommerce, and others.

Our Experience in Offshore Staff Augmentation

We are a US-based company, but our talent pool includes the most talented developers from Asia (Armenia, Georgia, Kirghizia, Kazakhstan), Europe (Portugal) and South America (Brazil, Chile, Argentina).

To ensure almost instant hiring, we have partners in the top software outsourcing countries we work with. Thanks to this, we can provide developers with the project practically in no time.

We never prioritize specialists based on their nationality or country of birth. We have the same criteria for all potential candidates. And this approach helps us find the best of the best. There are several points that we always focus on at the first stages of the hiring process. For us, they are tech skills and English proficiency.

How to Find the Best Countries to Outsource Software Development in Your Case

Here’s a quick checklist for you. Top 5 points to bear in mind:

  1. Focus on the value, not only on the costs. The principle “the cheaper - the better” is not the suitable one to follow. It is pretty standard in software development when meager prices should be viewed as an indicator of low quality. Nobody wants to overpay but try to find reasonable rates, not just very low.
  2. Pay attention to English proficiency. The primary key to a successful project is efficient communication with your team. Developers should clearly understand the requirements and the tasks that you have for them. That’s why it is crucial to find a team that will communicate with you without dictionaries and translators.
  3. Do not ignore cultural peculiarities. Despite the era of globalization that we humanity has already entered, people in different countries are still influenced by their cultures. Therefore, before establishing long-term cooperation with specialists from another country, it is recommended to ensure that the cultural differences won’t influence your work together and you quickly put up with them.
  4. Do not forget about time zones. Though it is quite natural that when you work with an offshore team, it is hardly possible that your working hours will fully coincide. But they should at least overlap. You need to have time for meetings and communication that will be comfortable for both sides.
  5. Try to find reliable information on the level of tech education in the country. Today on the internet, you can find a lot of reliable data. Make sure that the country under consideration has specialists with proper knowledge and education.

When the most appropriate country or region for the outsource is chosen, it’s time to seek a team to work on your project. In our blog, you can find a detailed article that provides tips on finding the best dedicated team. These recommendations work concerning searches for any remote team regardless of the chosen form of cooperation. Below you can find just a quick reminder of the aspects that you should focus on:

  • Previous experience of specialists, their knowledge, education and background
  • Tech stack that developers worked with on their previous projects
  • Abilities in communication with clients/other team members remotely
  • The reputation of a company that is ready to provide its developers, its business journey
  • Genuine reviews (you should know what the company's real clients think about their cooperation).

It’s worth mentioning one more thing about the success of offshore outsourcing. It can happen so that you find the best one of the top software outsourcing countries, then hire an excellent dedicated team, but your communication will turn out to be inefficient and not very successful. But what's the reason? Quite often, such a situation can be explained by a wrongly chosen project management methodology.

Today, Agile is the most widely used method for coordinating all work processes in an offshore software development team. It helps to achieve the highest productivity of a team and to get the best results possible. So, do not forget about this point to devalue all your previous efforts to look for the best team.

If you want to hire remote specialists on your own, we’d like to recommend searching for them in one of the best countries for outsourcing. But if you prefer to rely on a software development partner that will find the best experts for you, Geomotiv is always at your service. Over the years of work, we’ve managed to gain an excellent reputation on the market, and today we work hard in order not only to keep but also to strengthen our positions.

To learn more about the types of cooperation that we can offer in your particular case, please, fill in the form available on our website and we will contact you as soon as possible.

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