According to research done by IDC in the year 2014, there has been a rise in demand for nearshoring to Hungary, increasing the outsourcing services market. In Eastern Europe, Hungary is thereby selected by companies based in the US and EU as an outsourcing destination. This is credited to Hungary’s location and jurisdiction in the EU, adequate skills both in language and talent and affordable high standards of living.

Technology giants and big outsourcing companies have formed regional IT hubs around shared service centers. The services in this sector are as listed below:

•    IT services by Debrecen and Veszprem

•    Tata consulting by Miscols, Szeged and Pecs

•    Epam systems by Debrecen and Szeged

•    National instruments by Debrecen

•    BT by Debrecen

•    IBM by Veszprem, Miscols

•    Nokia by Veszprem and Szeged

•    Andtec and GmbH by Veszprem

•    HP and Microsoft by Miscols

•    CAS software by Szeged

•    T-systems and Morgan Stanley by Szeged

Notably, companies in Hungary, including LogMeln, Ustream and Prezi are in constant competition with Dev centers foreign and outsourcing companies for the best talents.

Salaries for software developers in Hungary

Despite taxes which make up 0.51 of Hungary’s total employment costs, IT wages are high. The salaries are usually based on education, position and location.

Hungary has a Cafeteria system. This is a common form of the fringe remuneration benefit system that doesn’t use cash that is subject to favorable tax regimes.

Hungary’s IT graduates and talent pool

As of 2015, software developers make up 0.015 of Hungary’s population. This is about 150,000 people. The number of students pursuing IT and related courses at the time was also relatively low. With these figures, the labor demand for IT is far outdoing the supply. However, private training programs are considerably growing the talent pool by forging new software developers.

The trend in software development is rapidly changing with software advancements and new technologies coming up quickly. However, there is a stagnant education which cannot measure up. The education system should be considerably revamped in order to keep up with the pace of software development trends.

Many people are motivated to join startups and even form their own companies in order to make a fulfilling impact in the IT sector both on a local and global scale. As a result, many are resigning from high-tech companies and being part of self-development to tap into the fluidity and expanding capacity potential that comes with startups. In respect to this trend, the quality of the labor force in Hungary can be well estimated to be high. Outsourcing talent from this country is definitely worth a shot.