While Poland & Ukraine have historically been the most popular software development outsourcing destinations in Central & Eastern Europe, Hungary is emerging as one of the best countries to outsource software development. Quietly, Hungary’s talent pool has been steadily increasing over the past few decades. Compared to Eastern Europe software development outsourcing, Hungary also offers the westernized culture of a Central European country. This has attracted many US companies to establish Hungary as their primary offshore software development destination.
Hungary: The Alternative to Software Development Outsourcing in Eastern Europe
Recent regional instabilities in the Eastern European region have highlighted the need for managing political risks when outsourcing to Eastern Europe Software Development Companies. As a member of the EU & NATO, Hungary provides the stability to safely invest in an offshore development team.
Why Hungary Has Become a Top Offshore Software Development Destination
- Tech Talent Ranked 3rd in all of Europe
- Largest IT Talent Pool in Central Europe
- Developers are Fluent in English (Ranked 2nd in Central & Eastern Europe)
- Hungary a Member of the EU & NATO
- Labor Laws Comply with European Standards
- Low-Context Communication Culture Matches Western Countries
- Low Attrition Rates for Developers
Hungary’s Tech Talent Ranking
Hungary ranks near the top of all European countries for developer skills, according to a 2021 HackerRank study.
| RANK | COUNTRY | DEVELOPER TECH SCORE |
| 1 | Slovakia | 100 |
| 2 | Czech Republic | 93.38 |
| 3 | Hungary | 92.86 |
| 4 | Poland | 92.74 |
| 5 | Serbia | 92.59 |
| 6 | Ireland | 92.27 |
| 7 | Ukraine | 91.26 |
| 8 | Switzerland | 91.08 |
| 9 | Germany | 90.70 |
| 10 | Austria | 90.15 |
Hungary Has a Large Developer Pool
Hungary has been steadily building its IT Talent Pool over the past few decades & now has the largest number of developers in all of Central & Eastern Europe. Here are the top 5:
| RANK | COUNTRY | POPULATION | # DEVELOPERS |
| 1 | Hungary | 10M | 155,000 |
| 2 | Czech Republic | 10.5M | 150,000 |
| 3 | Poland | 38M | 140,000 |
| 4 | Romania | 19.5M | 125,000 |
| 5 | Ukraine | 42M | 115,000 |
All Engineering Classes in Hungary are Taught in English
Agile requires Technical English Proficiency. If you are looking for developers who can communicate complex technical concepts in English “at speed”, then Hungary should be at the top of your list.
All engineering classes in Hungary are taught in English & students must pass the IELTS test in order to enter Engineering School. According to EF EPI, the preeminent English Proficiency rating body in the world, Hungary’s English proficiency is rated as “Very High”.
Hungary holds EU & NATO Membership
Often overlooked when choosing a Central or Eastern European development partner is the political stability of the country. Being a member of both the EU & NATO, Hungary is considered a stable outsourcing destination.
Hungary Has Favorable Euro-Centric Labor Laws
Bureaucratic labor laws can make it difficult to do business in some Eastern & Central European countries. Hungary’s labor laws are in line with European Union standards.
Hungary has a Low-Context Communication Culture
In her groundbreaking book, “The Culture Map”, Erin Meyer outlines the importance of having a low-context communication culture when blending multi-cultural, geographically dispersed teams. Hungary has a similar “low-context communication culture” to North America & Europe, which makes communication efficient & crisp.
Hungary Has Low Developer Turnover Rates
Hungarian software development companies have developer turnover rates below 10%, far below most Central & Eastern European countries. Compare that to 22% turnover rate in India & 12% in Latin America.
Conclusion
Once you realize the rich developer talent in Hungary & consider all of the other important variables for choosing an offshore software development destination, the decision is clear. Hungary belongs on every tech manager’s list of potential outsourcing destinations.
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